Chicago Mercantile Exchange

From MarketsWiki
Jump to: navigation, search
Not impressed? Tell us how to improve it or sign up to edit.
CmeLogo NoTag.jpg

Chicago Mercantile Exchange
Founded 1898 as Chicago Butter and Egg Board
Headquarters Chicago
Key People see CME Group
Products Futures and options on interest rates, foreign currencies, stock indexes, commodities, and alternative investment products (e.g., real estate, weather)
Twitter @CMEGroup
Facebook CMEGroup
Website www.cmegoup.com/

The former Chicago Mercantile Exchange (CME) (NYSE and Nasdaq: CME), often referred to by Chicago traders as "the Merc", is a global futures and options exchange that in July 2007 acquired the Chicago Board of Trade to become CME Group.[1] CME's futures and options offerings, which are about 75 percent electronically traded on the CME Globex electronic trading platform, include interest rates, equities, currencies, commodities, and alternative investment instruments including weather and real estate derivatives.

On June 2, 2008, it was announced that the Chicago Board Options Exchange (CBOE) and CME had, for $1 billion, settled a court case regarding who owns the (CBOE), ending an almost two-year lawsuit that had prevented the CBOE from merging with another exchange or going public. The settlement provided full CBOT members with an 18 percent stake in the CBOE and $300 million in cash, terms worth roughly $1 billion with a $4 billion valuation of the options market. To qualify for the settlement, CBOT members had to have valid trading rights at the CBOE and own 10,251 shares of the CME Group, which was formed in 2007 when the CME bought the CBOT. Rejected settlements ranged between $850 million and $1.3 billion.[2][3]

In September of 2012, it became known that Traiana, the post-trade services group owned by UK interdealer ICAP, would provide an application with a "kill switch" to limit damage from errant trading by algorithms to CME and NYSE Liffe.[4][5]

Contents

History

CME was founded in 1898 as the Chicago Butter and Egg Board as a not-for-profit company.[6] In 1919, its name was changed to the Chicago Mercantile Exchange. From its not-for-profit membership organization roots, the CME on Nov. 13, 2000, became the first U.S. financial exchange to demutualize into a shareholder-owned corporation. In December 2002, CME became a publicly traded company.[7]

In October 2006 the exchange announced that CME and cross-town rival, the Chicago Board of Trade, intended to pursue a merger, which in July 2007 was consummated. The merged corporation is CME Group.[8] In March of 2008, the CME Group purchased the New York Mercantile Exchange for $8.9 Billion dollars. [9]

Although the CME claims in various marketing materials to have "invented"[10][11] financial futures, in fact the now defunct International Commerce Exchange, founded in 1970 by members of the New York Produce Exchange (with which it soon merged), and located in New York, was the first exchange to trade currency futures, beginning on Apr. 23, 1970, two years before the Chicago Mercantile Exchange.[12][13]

It was after World War I that public participation of the markets was allowed.[14]

(See CME Group for additional historical highlights.)

Locations

Through the years, the CME has moved several times to accommodate the growth of the exchange.[15]

  • 20 S. Wacker: 1983 to Present
  • 444 West Jackson: 1972 to 1983
  • 110 North Franklin: 1928 to 1972
  • Lake and Wells: 1912 to 1928
  • South Water Street: 1898 to 1912

CME Annual Report

See Also

Product pages:


References

  1. CME and CBOT Complete Merger Creating the Leading Global Exchange. Chicago Board of Trade.
  2. "CBOE and CME Settle for $1 Billion". Chicago Tribune.
  3. "CME-CBOE Reach $1B Deal". Crains Chicago Business News.
  4. Traiana pushs ‘kill switch’ into futures market. FT.com.
  5. "CME-CBOE Reach $1B Deal". Crains Chicago Business News.
  6. Cme Group Inc. CNN.
  7. Prospectus. U.S. Securities Exchange Commission.
  8. FORM 425. U.S. Securities Exchange Commission.
  9. CME Group Agrees to Purchase NYMEX for $8.9 billion. Bloomberg.
  10. We Invented Financial Futures. CME Group.
  11. Negotiating a Market, Performing Theory: The Historical Sociology of a Financial Derivatives Exchange. Paper by Donald MacKenzie and Yuval Millo presented at European Association for Evolutionary Political Economy conference, Siena, November 8-11, 2001.
  12. Trading Organizations. U.S. Commodity Futures Trading Commission.
  13. Who is Murray Borowitz?. John Lothian News.
  14. History of the Chicago Mercantile Exchange. Google Books.
  15. Merc Memory Lane. Chicago Suntimes.

External links

CME Group web site

Personal tools
Namespaces

Variants
Actions
Navigation
John Lothian News
Special Pages
Share
Toolbox