ICE Futures U.S.

From MarketsWiki

ICE Futures U.S.

Founded	2007 (through merger)
Headquarters	New York
Key People	Thomas W. Farley, Pres./COO
Products	Soft commodities, interest rates, currencies and indexes
Web site	https://www.theice.com/

IntercontinentalExchange conducts global futures and options markets in soft commodity, foreign exchange, interest rates, currencies and equity index markets through its U.S. futures exchange, ICE Futures U.S., formerly the New York Board of Trade (NYBOT). The NYBOT was acquired by ICE in January 2007.

Clearing services for ICE Futures U.S. are provided through ICE Clear U.S. In early 2007, the U.S. Internal Revenue Service gave ICE Futures contracts, which are regulated in the United Kingdom, the same tax treatment as contracts traded on U.S. futures exchanges. The ruling applied to contracts traded from Apr. 1. The ruling meant that U.S. market participants would receive a 60/40 tax treatment.^[1] Many believed the change in tax treatment served to put ICE on more level ground with the New York Mercantile Exchange.

Thomas W. Farley is president and COO of the ICE Futures U.S.

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History

The ICE and NYBOT announced their merger agreement on Sept. 14, 2006, and the deal was completed on Jan. 12, 2007. The transaction consideration comprised 10.297 million shares of ICE common stock and $400 million in cash. The number of shares of ICE common stock issued pursuant to the merger agreement represented approximately 15% of the issued and outstanding share capital of ICE. Computershare Shareholder Services, Inc., as exchange agent delivered the applicable merger consideration to each NYBOT member by late January 2007.

Side-by-side (electronic and open outcry) trading of the NYBOT's benchmark agricultural commodities on ICE's electronic trading platform began the evening of Jan. 25 for the trade date Jan. 26.

On Oct. 22, 2007, The Wall Street Journal posted a report that NYBOT is planning to officially shut down its futures pits in the next six months as electronic commodities trading takes over. (Note that the WSJ cited sources "familiar with the matter.") It could also eventually lead the downtown exchange to abandon its headquarters at the World Financial Center, according to the report.^[2]

On Feb. 25, 2008, ICE Futures U.S. said that effective with the start of trading on Apr. 1, 2008, the exchange would implement amendments to its open outcry trading hours for the following options contracts (all times are New York times):

ICE Sugar No. 11 options 8:10 a.m. to 1:30 p.m.
ICE Coffee "C" options 8:00 a.m. to 1:30 p.m.
ICE Cocoa options 8:00 a.m. to 1:00 p.m.
ICE USDX and Euro Index options 8:00 a.m. to 3:00 p.m.

For all other products, options floor trading hours would be unchanged and remain as follows:

ICE Cotton No. 2 options 10:30 a.m. to 2:15 p.m.
ICE FCOJ-A options 10:00 a.m. to 1:30 p.m.
ICE RJ-CRB options and CI Indexes options 10:00 a.m. to 2:30 p.m.
ICE Russell options and NYSE Stock Index options 9:30 a.m. to 4:15 p.m.^[3]

Products

ICE Futures U.S. offers trading in futures and options on sugar, cotton, coffee, cocoa, and orange juice, in addition to interest rates, currency, and indexes.

In October 2007, ICE Futures U.S. announced that it would begin offering 11 electronically traded foreign exchange futures 22 hours/day, beginning on Nov. 9, 2007, with the listing to occur in phases. These include: British pound/Japanese yen; British pounds; British pound/Swiss franc; British pound/US dollar; Euro/British pound; Euro/Japanese yen; Euro/Swiss franc; Euro/US dollar; Swiss franc/Japanese yen; US dollar/Japanese yen; and US dollar/Swiss franc.

On September 22, 2008 ICE announced the successful transition of the U.S. Russell Index complex to ICE Futures U.S. ICE signed an exclusive license agreement with Russell Investments in June 2007 that gave ICE the exclusive right to trade futures and options based on Russell's U.S. equity indexes. These include the Russell 1000 Index and Russell 2000 Index, as well as the related value and growth indexes Russell offers.

In October of 2008, it was announced that ICE Futures U.S. would launch a suite of million-currency-unit foreign exchange (FX) futures contracts on Nov. 6, 2008. The new futures contracts, known as ICE Millions and first announced on Sept. 24, combine the benefits of futures and OTC products, bringing additional transactional efficiencies and risk management tools to the FX marketplace. ICE Millions are 10 times the notional value of the existing suite of ICE FX futures and options contracts. ICE Futures U.S. also lists the ICE U.S. Dollar Index futures, which would remain the existing notional size of $1000 times the index value.^[4]