CHICAGO, Feb. 28, 2011 /PRNewswire/ -- CME Group, the world's leading and most diverse derivatives marketplace, announced the creation of a new clearing membership class for interest rate futures allowing for significant margin offsets between CME Group Interest Rate futures and U.S. Treasury securities. The Financial Instruments Clearing Membership (FICM), which is expected to be offered by the end of the first quarter, will provide margin offsets of up to 65 percent to qualified firms that trade both U.S. Treasury securities and CME Group Interest Rate futures products.
"We are establishing this new clearing membership category to provide customers who trade both U.S. Treasury securities and CME Group's Interest Rate futures with greater capital efficiencies, enabling firms to trade cash/futures strategies in a highly cost-effective manner," said Bryan Durkin, CME Group's Chief Operating Officer and Managing Director of Products and Services. "With our interest rate complex open interest at 37 million contracts or $30 trillion in notional value, the new FICM membership provides a strong value proposition for our global customers who trade these products."
The FICM membership category leverages existing infrastructure of firms that are active in both the U.S. Treasury securities and CME Group Interest Rate futures markets. The new membership class combines the benefits of CME Group's deep, liquid Interest Rates futures markets with our industry leading risk management financial safeguards and proven track record of CME Clearing.
A number of trading firms, including Breakwater Trading, Endeavor Trading, Henning-Carey Proprietary Trading, and HTG Capital Partners, have tested and validated the FICM membership and are working with CME Group to become FICM members. A full CME clearing member must sponsor the FICM and act as the firm's facilities manager to transact in the U.S. Treasury securities market.
To view a video of Derek Sammann, Managing Director of Interest Rate and FX Products, talking about the new FICM, visit: http://at.pscdn.net/008/00102/videoplatform/110223FICM_Ext.html
For additional information about the Financial Instruments Clearing Membership, visit: www.cmegroup.com/ficm
As the world's leading and most diverse derivatives marketplace, CME Group (www.cmegroup.com) is where the world comes to manage risk. CME Group exchanges offer the widest range of global benchmark products across all major asset classes, including futures and options based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, weather and real estate. CME Group brings buyers and sellers together through its CME Globex electronic trading platform and its trading facilities in New York and Chicago. CME Group also operates CME Clearing, one of the leading central counterparty clearing services in the world, which provides clearing and settlement services for exchange-traded contracts, as well as for over-the-counter derivatives transactions through CME ClearPort. These products and services ensure that businesses everywhere can substantially mitigate counterparty credit risk in both listed and over-the-counter derivatives markets.
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SOURCE CME Group