Client Management Advisory Notice
From | Systems Liaison
Subject | New options on CME Lean Hog Index contract to be listed June28th
Effective Date | 06/22/00
Notice Number | NP#0001
CONTRACT NAME: Options on CME Lean Hog IndexTM LISTING DATE: Wednesday, June 28, 2000 DESCRIPTION: Put and Call options on the CME Lean Hog Index� CONTRACT SIZE: The trading unit shall be an option to buy, in the case of the call, or to sell, in the case of the put, the value of 40,000 pounds times the CME Lean Hog Index�. OPENING DAY TRADING HOURS: 9:10 a.m. to 1:02. p.m. REGULAR TRADING HOURS: Same as Options on Lean Hogs Futures, from 9:10 a.m. to 1:02 p.m. VALID CONTRACT MONTHS: January, March, May, September and November. INITIAL CONTRACT MONTHS: September. TCC COMMODITY CODE/ TICKER SYMBOL: 7H MINIMUM PRICE INTERVAL: The price of an option shall be quoted in cents per pound. Minimum price fluctuations shall be in multiples of $.00025 per pound (also known as one tick). A trade may also occur at a price of $.000125 per pound ($5.00, also known as one-half tick), whether or not it results in the liquidation of positions for both parties to the trade. DOLLAR VALUE PER TICK: $.00025 per pound, or $10.00 per contract. TERMINATION OF TRADING: Options trading shall terminate on the tenth business day of the contract month at 12:00 noon CST. POSITION LIMITS: No person shall own or control a combination of Index options and Lean Hogs futures and Options on Lean Hogs futures that exceeds: 1. 2400 futures equivalent contract net on the same side of the market in any contract month. 2. 950 futures equivalent contracts net on the same side of the market in the expiring contract month as of the close of business on the fifth business day of the contract month. For purposes of this rule, the futures equivalent of an option contract is 1 times the previous business day�s IOM risk factor for the option series. Also for purposes of this rule, a long call option, a short put option and a long futures contract are on the same side of the market; similarly, a short call option, a long put option and a short futures contract are on the same side of the market. EXERCISE: European style. An option may be exercised by the buyer only on the expiration day of the contract. To exercise an option, the clearing member representing the buyer shall present an exercise notice to the Clearing House by 7:00 p.m. on the expiration day. An option that is in-the-money and has not been liquidated or exercised shall, in the absence of contrary instructions delivered to the Clearing House by 7:00 p.m. on the expiration day of the contract by the clearing member representing the option buyer, be exercised automatically. The expiration day is the second business day following the termination of trading. EXERCISE PRICE INTERVALS: The exercise prices shall be stated in terms of cents per pound. For all contract months, exercise prices shall be at intervals of 1 cent; e.g., $.60, .61, .62, etc. At the commencement of option trading, the Exchange shall list put and call options in a range 20 cents above and below the previous day�s price of the CME Lean Hog Index�. When a subsequent day�s Index price occurs at, or passes through an exercise price, the Exchange shall list on the next trading day put and call option contracts at the next higher (or next lower) exercise price within a 20 cent range above (or below) the exercise price at which or through which the underlying Index price occurred. New options may be listed for trading up to and including the termination of trading. INITIAL EXERCISE PRICES: To be determined. MINIMUM REPORTABLE LEVEL: 25 contracts or greater. CFTC REPORTABLE NUMBER: Contact Judy Sepsey, CFTC, at (312) 353-9028. PERFORMANCE BOND REQUIREMENTS: To be published by the Clearing House. CLEARING FEES: Waived through December 29, 2000. ELIGIBLE MEMBERSHIP DIVISIONS: IOM Division. GEM may trade as part of New Product Access Program. PRICE CONVENTIONS: Same as for Options on Lean Hog Futures.
| Premium (Trade Price) | Exercise Price
Actual Price: | 1.250 | 68.000
TREX/TES Format: | 1250 | 0680
Trade Register: | 1.250 | 68.000
Recap Ledger: | N/A | 0680
Unmatched Trade Notice: | 250 | 0680
Cabinet Price Format: | CAB 9999999 | 0680
Trade Register File: | 1.250 | 0680
Settlement Price File: | 1250 | 0000680
SPAN File (SPAN): | 1250 | 0000680
APS/GUS File Format: | 1250 | 0000680
Please contact one of the following for further information: Exercise/Assignment Information Trade Processing Unit (312) 207-2525 Performance Bond Information: Risk Management Department (312) 648-3888 Position Limits: Ken Lovett (312) 648-3259 General Information: Fern Szymborski (312) 207-2586 Thank you.