CBOT Agency Contracts Generate Strong And Steady Growth

The Chicago Board of Trade announced today that its newest contract, 10-Year Agency Note futures based on Fannie Mae‚ Benchmark NotesSM and Freddie Mac Reference NotesSM, experienced strong and steady growth during its first week of trading.

CBOT members traded 8,376 10-Year Agency Note futures contracts on Wednesday, March 22, a 478% increase from March 15, its first trading day.

CBOT Chairman David P. Brennan said, "The growing volume and liquidity in our agency futures demonstrate the CBOT is the natural home for these products. The price of agency futures is a function of Treasury markets, and only CBOT members can provide the established and unmatched liquidity in Treasury derivatives now and over the long-term."

CBOT members attribute much of the growing volume in agency business to the "TAG Spread" - the Treasury-over-agency spread that reflects the difference in credit risk between AAA-rated agency debt and U.S. Treasury debt.

As part of its trading incentive program, the CBOT is waiving all Exchange transaction fees for the Agency Note contracts through the end of the 2000 calendar year.