Open interest at the close of trading yesterday was 21,692. The contract, launched March 15, reached this open interest level faster than any previous new contract at the CBOT. Roughly 50 percent of the trading in the Agency contracts results from customer orders.
Many fund managers and professional traders view the 20,000 open interest level as an important measurement of liquidity and a contract's long term success.
Bill Paddor, a financial futures executive on the trading desk for CS First Boston, said, "20,000 is considered a significant number by most money mangers and is a benchmark for when a contract is considered established."
Patrick Catania, CBOT Executive Vice President who oversees the product development for the exchange, said, "The agency contracts continue to grow in popularity and are generating important hedging and spreading opportunities for professional traders and their customers."
Plans are being considered by the CBOT to expand the physical trading area for the contracts to facilitate the increase in interest in the product from the outside public.
The CBOT 10-Year Agency Note futures and options contracts are based on Fannie Mae® Benchmark NotesSM and Freddie Mac Reference NotesSM. The CBOT will launch 5-Year Agency Notes on May 3.
