Cme Group Inc. · NASDAQ:CME
Cme — Corporate Update (February 2010)
66 slides from Cme's corporate update, Feb 9, 2010
Slide 1: CME Group Customer Forum Q1 2010
CME Group Customer Forum Q1 2010 Sydney February 9, 2010 Singapore February 11, 2010 Tokyo February 16, 2010 N New Y Yorkk M h 2, March 2 2010 Chicago March 4, 2010 London March 16, 2010
Slide 2: Agenda
Agenda 1. New Clearing Initiatives • CME Clearing Europe • CME ClearPort API 2 2.0 0 • Credit Default Swaps • FX OTC Clearing • Cleared OTC Interest Rate Swaps 2. Product Update • Equity Updates • Interest Rate Options • Ultra T-Bond Futures 2
Slide 3: Agenda, continued
Agenda, continued 3. Partner Exchange Initiatives • Green Exchange Venture • BM&F BOVESPA SA Update • Korean Hub & KRX Agreement g • Bursa Malaysia Agreement 4. Electronic Trading Updates • CME Globex Performance Enhancements • FIX/FAST 2.0 Release • CME Globex Market Data Reporting p g Initiative •
Slide 4: Expanding our Clearing Offering: CME Clearing Europe
Expanding our Clearing Offering: CME Clearing Europe 9 Multiple Asset Classes Commodities Energy Interest CME CllearPort Credit FX … Metals Rates Ags 9 Multiple Jurisdictions and Time Zones US Europe CME Clearing US CME Clearing Europe 4
Slide 5: Unique Benefits and Opportunities
Unique Benefits and Opportunities CME Clearing Europe • Provide a European clearing solution to our global customer base. Our customers can take advantage of : • UK regulatory environment and English law, • European time zone and local proximity, • Services tailored to European market practices prac
Slide 6: For More Information
For More Information CME Clearing Europe • Andrew Lamb at +44 207-796-7170 or at [email protected] • Tina Hasenpusch at +44 759-095-0035 or at [email protected] Prod cts & Ser Products Services ices • Danielle Dycus at +44 207-796-7102 or at [email protected] • Samantha P
Slide 7: CME ClearPort Update
CME ClearPort Update • E Established t bli h d in i 2002, 2002 CME ClearPort Cl P t is i growing i as more OTC market k t participants ti i t take advantage of the opportunity to mitigate counterparty risk • Today, CME ClearPort: • Clears more than 500 500,000 000 contracts daily • Brings together m
Slide 8: CME ClearPort Update
CME ClearPort Update Flexible Clearing Services open to all OTC market participants • Independent of execution OTC • Security from significant mitigation of counterparty risk • Certainty C t i t off iindependent, d d t neutral t l settlement ttl t prices i • Efficiencies for capital and operations P
Slide 9: CME ClearPort API 2.0 Update
CME ClearPort API 2.0 Update Key Benefits • FIXML 5.0 SP2 compliance (with some custom tags) • MQ Series or HTTP connectivity (continued option of Internet, VPN or Lease Line) • Multi-broker platform support • Support of various multi multi-leg leg instruments on trade submissions (IntraCommodity Sp
Slide 10: CME Group Cleared OTC Credit Default Swaps
CME Group Cleared OTC Credit Default Swaps Current Status Working closely with market participants on both the buy side and sell side CME Group began clearing credit default swaps (CDS) through CME side, Clearing on December 15, 2009. • CME Group’s cleared-only CDS initiative was jointly developed w
Slide 11: CME Group Cleared OTC Credit Default Swaps
CME Group Cleared OTC Credit Default Swaps Dealer Founding Members Barclays Capital Citi Credit Suisse Deutsche Bank Goldman Sachs J.P. Morgan Morgan Stanley UBS Buy-Side Founding Members AllianceBernstein BlackRock BlueMountain Capital Management Citadel D. E. Shaw Group PIMCO Oth CDS M Other Membe
Slide 12: CME Group Cleared OTC Credit Default Swaps
CME Group Cleared OTC Credit Default Swaps Product Scope • CME Group’s cleared OTC CDS contracts are designed to mirror and be economically equivalent to bilateral OTC contracts: • Consistent with ISDA definitions and adhere to ISDA determinations • Eligible for participation in ISDA auctions • Stan
Slide 13: CME Group Cleared OTC Credit Default Swaps
CME Group Cleared OTC Credit Default Swaps For more information on Cleared OTC CDS, please contact: • Brian Oliver at +1 312 930-1330 or at [email protected] • Tina Lemieux at +1 312 930-3151 or at [email protected] • Jennifer Peve at +1 312 466-7472 or at [email protected]
Slide 14: CME Group's Cleared OTC FX Initiative: FX through CME ClearPort
CME Group’s Cleared OTC FX Initiative: FX through CME ClearPort CME Group will offer a Clearing Service to facilitate the clearing and settlement of OTC FX positions • Product coverage includes FX Spot, Forwards, Swaps, NDF’s and FX Options as well ell as traditional FX F Futures t res and Options o
Slide 15: CME Group's Cleared OTC FX Initiative
CME Group’s Cleared OTC FX Initiative CME Group Group’s s OTC FX Clearing Service delivers the following value proposition: • Mitigate counterparty risk • CME Group acts as the central counterparty to all transactions • Market Expansion – Increases access to participants and opens credit lines to re
Slide 16: CME Group's Cleared OTC FX Initiative: FX through CME ClearPort
CME Group’s Cleared OTC FX Initiative: FX through CME ClearPort For more information, please contact the global FX product team: Managing Director of Financial Products and Services: Derek Sammann +1 312 466 7454 Chicago: Scott Brusso +1 312 930 3133 Mike Hohman +1 312 930 1773 Craig LeVeille +1 312
Slide 17: Overview of Cleared OTC Interest Rate Swaps
Overview of Cleared OTC Interest Rate Swaps CME Group is actively engaged with both buy and sell side firms to launch the premier centrally cleared solution for OTC vanilla interest rate swaps, maximizing capital and operational efficiencies and reducing systematic risk for all market participants P
Slide 18: Initial Product Scope: Clearing OTC IRS
Initial Product Scope: Clearing OTC IRS USD EUR Tenors 0-30Y 0-30Y Fixed frequency Semi-Annual Annual Floating index 3M BBA-LIBOR 6M EURIBOR Fixed day count 30/360 30/360 Floating day count ACT/360 ACT/360 Accrual type ADJUSTED ADJUSTED Introduction of Products: Phase 1: Flexible coupons and start d
Slide 19: For More Information
For More Information Products & Services Steve Dayon +1 1 312-466-4447 312 466 4447 [email protected] Liz Flores +1 312-338-2801 [email protected] Robert Hammond +44-207-796-7124 [email protected] Ron Peterson +1 212-897-5285 [email protected] Clearing Sunil Cuti
Slide 20: Agenda
Agenda 1. New Clearing Initiatives • CME Clearing Europe • CME ClearPort API 2.0 • Credit Default Swaps • FX OTC Clearing Cl i • Cleared OTC Interest Rate Swaps 2. Product Update • Equity Updates • Interest Rate Options • Ultra T-Bond Futures 20
Slide 21: Agenda, continued
Agenda, continued 3. Partner Exchange Initiatives • Green Exchange Venture • BM&F BOVESPA SA Update • Korean Hub & KRX Agreement g • Bursa Malaysia Agreement 4. Electronic Trading Updates • CME Globex Performance Enhancements • FIX/FAST 2.0 Release • CME Globex Market Data Reporting p g Initiative •
Slide 22: Equity Index Products
Equity Index Products Monthly ADVs, S&P 500 Weekly Options 7,000 6,000 E-mini S&P 500 Weeklies Strong Traction in S&P 500 Weekly Options S&P 500 Weeklies 5,000 • Over 480,000 Contracts Traded (August 2009 4 000 4,000 launch through year-end 2009) 3,000 • E-mini ($50) or Standard ($250) contracts 2,0
Slide 23: Interest Rate Options on CME Globex
Interest Rate Options on CME Globex • Improvements made to Options Strategies on CME Globex • Full User Defined Spreads • Consistency of strategy types such as calendars and diagonals • Market makers in Treasury and Eurodollar Options both streaming quotes t andd responding di tto requests t for f q
Slide 24: Treasury Options Electronic Migration
Treasury Options Electronic Migration Electronic Product Electronic ADV Pit ADV Total ADV g Percentage 30 Year Bond 31,305 19,487 50,792 62% Options* Ten Year Note , 41,505 119,497 , 161,002 , 26% Options Five Year 4,714 10,132 14,846 32% Note Options Two Year 3,524 6,087 9,611 37% Note Option Treas
Slide 25: CME Group Option Technology Partners
CME Group Option Technology Partners Demos on Advanced Options Functionality Now Available • ISV Option Technology Partners systems offer the ability to: • Submit and view RFQs in any y CME Group p asset class • Trade outrights and complex spreads • View, trade and create user-defined spreads • View
Slide 26: Long-Term U.S. Treasury Bond Futures: The Ultra T-Bond
Long-Term U.S. Treasury Bond Futures: The “Ultra” Ultra TT-Bond Bond • Comparable to the existing 30-Year T-Bond futures with similar contract specifications, but delivery basket includes bonds with terms to maturity of 25 years or longer • Since launching January 11, average daily volume is more th
Slide 27: For more information, contact the IR Product Group
For more information, contact the IR Product Group Robin Ross, Ross Managing Director +1 312 559 4989 [email protected] robin ross@cmegroup com Pete Barker, Director +1 312 930 8554 [email protected] Jack Callahan, Associate Director +1 312 454 8312 [email protected] Steve Day
Slide 28: Agenda
Agenda 1. New Clearing Initiatives • CME Clearing Europe • CME ClearPort API 2.0 • Credit Default Swaps • FX OTC Clearing • Cleared OTC Interest Rate Swaps 2. Product Update • Equity y Updates • Interest Rate Options • Ultra T-Bond Futures 28
Slide 29: Agenda, continued
Agenda, continued 3. Partner 3 a t e Exchange c a ge Initiatives t at es • Green Exchange Venture • BM&F BOVESPA SA Update • Korean K H Hub b & KRX A Agreement • Bursa Malaysia Agreement 4. Electronic Trading Updates • CME Globex Performance Enhancements • FIX/FAST 2.0 Release • CME Globex Market Da
Slide 30: Green Exchange Venture
Green Exchange Venture • Environmental p product suite currently y listed as NYMEX products • Joint Venture with 13 shareholders comprising a diverse group of industry leaders in environmental markets markets, including CME Group Group, Constellation Energy, Credit Suisse, Evolution Markets, Goldman
Slide 31: Green Exchange Venture: Technical Changes
Green Exchange Venture: Technical Changes F t Futures: Once Green Exchange becomes designated as a DCM, a subset of current NYMEX products will become Green Exchange Products Technical changes required to make these Green Exchange products include: • Tag T 207-SecurityExchange 207 S it E h updated d
Slide 32: CME Group to BM&FBOVESPA
CME Group to BM&FBOVESPA System providers certified to support BM&FBOVESPA products on CME Globex: (bold= new) • Aegisoft • Patsystems • Barx • Penson GHCO • Communytek • Rithmic • CQG Messenger • RTS Realtime Systems • FFastFill • SunGard (formerly GL Trade) • GS REDIPlus • Trading Technologies • I
Slide 33: Order Routing Overview: CME Group to BM&FBOVESPA
Order Routing Overview: CME Group to BM&FBOVESPA BM&FBOVESPA Quarterly ADV as a Result of CME Globex Order Routing 200 200,000 150 000 150,000 100,000 50,000 0 Q1 Q2 Q3 Q4 Q1 To Date • CFTC approval for trading of the Ibovespa Index Derivatives by US resident investors granted August 27, 2009 • More
Slide 34: CME Group-KRX Initiative
CME Group-KRX Initiative Communications Hub • Launched L h d iin April A il 2009 • Provides access to products on CME Globex • 3 firms currently connected; 1 in progress Phase 1: Kospi 200 Future listing on CME Globex overnight • Scope narrowed due to regulatory hurdles; only Korean participants • L
Slide 35: CME Group-KRX Initiative
CME Group-KRX Initiative Daily Volume of Phase 1: 4500 KRX Kospi 200 Futures on CME Globex via Korea 4000 3500 3000 2500 2000 1500 1000 500 0 35
Slide 36: CME Group-Bursa Malaysia Initiative
CME Group-Bursa Malaysia Initiative Strategic Benefit : • Increases visibility and distribution of Malaysia’s benchmark palm oil contract • Strengthens commodity offerings of both markets to improve global risk management • Facilitates customer access to global commodities and equity index products
Slide 37: Phase 1: USD-Denominated Crude Palm Oil
Phase 1: USD-Denominated Crude Palm Oil • Target launch: May 2010 • Available on CME Globex and CME ClearPort • Largest consumed edible oil in the world • Produced primarily in Malaysia and Indonesia • The oil is extracted from the fruit of the palm tree CPO • Primary importers are China, India and
Slide 38: Contract Specs for U.S. Dollar Cash-Settled Crude Palm Oil Futures
Contract Specs for U.S. Dollar Cash-Settled Crude Palm Oil Futures *Pending Pending regulatory approval* approval Trading Unit 25 metric tons Underlying Instrument Bursa Malaysia Derivatives Berhad Crude Palm Oil Futures (FCPO) Price Basis U.S dollars and cents per metric ton Tick Size USD $0.25 $ p
Slide 39: Bursa Derivatives Partner Overview
Bursa Derivatives Partner Overview Background YTD 2009 Volume Breakdown 3.2% Established: 2001 Current Trading System: 100% electronic trading Crude Palm Oil currently utilizing NYSE.ENXT (NSC) technology 48.5% KLSE Composite Index Clearing and settlement: Owns Bursa Derivatives Clearing with 19 cur
Slide 40: Phase Two: BMD Products on CME Globex
Phase Two: BMD Products on CME Globex • Telecommunications hub in Kuala Lumpur targeted launch: May 2010 • Standard, redundant international hub • Access to all CME Group and ultimately BMD products • Bursa Malaysia Derivatives products targeted for Q3 2010 • BMD Clearing Firm agreement required • S
Slide 41: Agenda
Agenda 1. New Clearing Initiatives • CME Clearing Europe • CME ClearPort API 2.0 • Credit Default Swaps • FX OTC Clearing • Cleared OTC Interest Rate Swaps 2. Product Update • Equity E it Updates U d t • Interest Rate Options • Ultra T-Bond Futures 41
Slide 42: Agenda, continued
Agenda, continued 3. Partner Exchange Initiatives • Green Exchange Venture • BM&F BOVESPA SA Update • Korean Hub & KRX Agreement • Bursa Malaysia Agreement 4. Electronic Trading Updates • CME Globex Performance Enhancements • FIX/FAST 2.0 Release • CME Globex Market Data Reporting Initiative • CME G
Slide 43: FX Futures Enhancements
FX Futures Enhancements The FX futures enhancements in February and August, and proactive management of infrastructure, resulted in dramatic performance improvements throughout 2009 Order Volume RTT (ms) RTT Trendline 28,000,000 14 24,000,000 12 20,000,000 10 Messages seconds 16,000,000 8 Order M Mi
Slide 44: CBOT Equity Futures Enhancements
CBOT Equity Futures Enhancements CBOT Equity futures enhancements in the 3rd quarter, quarter and infrastructure improvements in November, led to dramatic performance improvements Order Volume RTT (ms) RTT Trendline 7 000 000 7,000,000 16 6,000,000 14 12 5,000,000 Orderr Messages 10 Milliiseconds 4,
Slide 45: CME Equity Futures Enhancements
CME Equity Futures Enhancements In 4th quarter 2009, the same enhancements were implemented for CME Equity futures Order Volume RTT (ms) RTT Trendline 35 000 000 35,000,000 20 18 30,000,000 16 25,000,000 14 Orderr Messages 12 Milliiseconds 20,000,000 10 15,000,000 8 10,000,000 6 4 5,000,000 2 0 0 45
Slide 46: Commodity, Weather, KCBT and MGEX Futures Enhancements
Commodity, Weather, KCBT and MGEX Futures Enhancements • CME and CBOT commodity; CME weather; KCBT and MGEX futures and futures spreads p on CME Globex will be enhanced resulting g in minor functional changes and performance improvements • The changes are identical to those that occurred with the FX
Slide 47: Additional Engine Performance Enhancements
Additional Engine Performance Enhancements • Upgrade U d tto IInterest t t Rate, R t NYMEX and d COMEX futures f t markets k t on the th CME Globex platform that will result in significantly reduced message response times. Expected to reduce iLink and FIX/FAST response times by an average g of: • 15
Slide 48: FIX/FAST 2.0: Customer-Driven Enhancements
FIX/FAST 2.0: Customer-Driven Enhancements • Easy way tto id E identify tif the th sequence number b without ith t d decoding di the th full f ll message • Improves arbitration process between A and B feeds; saves processing time • Method to identify the instrument without decoding entire message •
Slide 49: FIX/FAST 2.0: Preamble
FIX/FAST 2.0: Preamble 1) Sequence Number: Included in a 4-byte unsigned integer field in the message UDP payload, not as part of the FAST message 2)) Instrument Filter via Sub-channel: Creates up p to 4 g groups p of instruments within each channel. Incremental messages would carry data related to
Slide 50: FIX/FAST 2.0: UDS Options Dynamic Delete
FIX/FAST 2.0: UDS Options Dynamic Delete • CME Globex supports User-Defined Spreads (UDS) for Options and Covereds. Each UDS is identified by the tag 48-SecurityID in FIX/FAST and d by b tag t 107-SecurityDesc 107 S it D i iLink in iLi k • A range of SecurityID values are reserved for UDS creation f
Slide 51: FIX/FAST 2.0: Certification & Deployment
FIX/FAST 2.0: Certification & Deployment • AutoCert+ has 4 new tests dedicated to FIX/FAST 2.0 20 • Available March 15; all systems must certify • Two mock trading sessions planned in production • Five FIX/FAST 2.0-format channels will be deployed in parallel for a partial production launch on May 9
Slide 52: FIX/FAST 2.0 Timeline
FIX/FAST 2.0 Timeline Key Dates Event January 14 Client Impact Published February 1 Available in New Release March 15 New AutoCert+ Tests Available April 24 New templates available in Production May 1 Mock Trading Session 1 May 8 Mock Trading Session 2 y9 May Partial p parallel Production deployment
Slide 53: CME Group Market Data Licensing & Reporting
CME Group Market Data Licensing & Reporting CME Group requires that all use of market data be licensed and reported • Current policies and reporting requirements are covered under Schedule 7 of the Connection Agreement and/or Schedule 4 of the Information Distribution License Agreement • CME Group i
Slide 54: CME Group Market Data Licensing & Reporting
CME Group Market Data Licensing & Reporting Market Data License Agreement requires all distributors to report market data usage on a monthly basis • A distributor is any party that has entered into an agreement with CME Group whereby it is authorized to receive, use, and distribute market data • Rep
Slide 55: CME Group Market Data Licensing & Reporting
CME Group Market Data Licensing & Reporting • To discuss your market data distribution and configuration, and establish COWS access, please contact Information Products Management (IPM) • +1 312-634-8395 or [email protected] • Additional information regarding the CME Group Market Data Policy,
Slide 56: CME Globex Data Center Migration
CME Globex Data Center Migration To accommodate continued growth, CME Group is expanding its infrastructure; as a result we will move the Globex infrastructure to a new state-of-the-art data center. The migration will have 2 phases: h Phase 1: iLink Production IP Address Migration: Q3 2010 • New iLi
Slide 57: CME Globex Data Center Migration
CME Globex Data Center Migration • All directly connected customers sites will be affected by the IP changes • Look for additional information in future CME Globex Notices such as: • Client Overview Document • Timing and method of distribution of the new IP addresses g g to the new data center • Pro
Slide 58: Agenda
Agenda 1. New Clearing Initiatives • CME Clearing Europe • CME ClearPort API 2.0 • Credit Default Swaps • FX OTC Clearing • Cleared OTC Interest Rate Swaps 2. Product Update • Equity E it Updates U d t • Interest Rate Options • Ultra T-Bond Futures 58
Slide 59: Agenda, continued
Agenda, continued 3. Partner Exchange g Initiatives • Green Exchange Venture • BM&F BOVESPA SA Update • Korean Hub & KRX Agreement • Bursa Malaysia Agreement 4. Electronic Trading g Updates p • CME Globex Performance Enhancements • FIX/FAST 2.0 Release • CME Globex Gl b Market M k t Data D t Reporti
Slide 60: CME Globex Credit Controls
CME Globex Credit Controls Pre-execution P ti risk i k controls t l that th t enable bl CME Clearing Cl i Firm Fi Risk Ri k Administrators to set credit limits through the CME Group Risk Administration GUI • Not intended to replace p clearing g firm’s existing g systems y risk management g • No nega
Slide 61: Globalizing cmegroup.com
Globalizing cmegroup.com • Drive more visitors to our site through robust, in-language Web presences in all of o ourr ke key Global markets. • Be agile g enoughg to qquicklyy create and support new Web initiatives to keep pace with our expanding Global business. • Launch more effective, targeted onl
Slide 62: We can also work with you to post these assets on your web site
We can also work with you if you would like to post some of these assets directly onto your firm’s web site. 62
Slide 63: To learn more about what we are developing, contact us
To learn more about what we are developing, contact t t us att 312.930.6937 312 930 6937 or by b emailil att [email protected] i f @ 63
Slide 64: EMEA Updates
EMEA Updates Ongoing Reminder: Eventual Pinnacle House Migration • The London Pinnacle House Hub (MDP B feed) will be retired, exact timing and new hub location is TBD • A minimum of 12 months notice will be given so customers can manage their telecommunications agreements. The Pinnacle House hub an
Slide 65: Quiz and Questions
Quiz and Questions & CME Group ACME AChicage Duard af Taxi RPRIEK Company
Slide 66: Appendix A: Important Dates Summary
Appendix A: Important Dates Summary Events 2010 Dates CME Globex Commodity Group Enhancements • CME Commodity & Weather Futures • March 7 • CBOT Commodity Commodity, KCBT, KCBT MGEX Futures • March 28 FIX/FAST 2.0 Migration February 1 – June 6 • New Release • February 1 • Production Parallel • May 9