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1. Trading method will be changed from the floor-based "Itayose Trading" to the computerized "Systems Trading". (January 4, 2005)
2. Contract unit will be reduced from 10,000 kg to 5,000 kg. (From July 2005 contract which will be generated on Jan. 26, 2005)
1. The following changes will accompany the start of system trading in the rubber market on January 4, 2005
(1) Daily Price Limit
Presently, the daily price limit for the current contract month is removed on the 15th of the month, or brought forward to the nearest business day if the 15th is not a business day. Effective from January 4, 2005, the daily price limit will be removed on the first business day of the month.
Example:January 2005 contract month: Removed on January 4.
Example: February 2005 contract month: Removed on February 1.
(2) Trading on the Last Trading Day of the Current Contract Month
The following changes will be made for trading on the last trading day of the contract month.
| Systems trading (new) | Itayose trading (old) | |
| A. Trading hours | Morning session only (9:00 to 11:00) |
First and second morning sessions (9:45 and 10:45) |
| B. Settlement price | Opening price on last trading day | Contract price in second morning session |
| C. Delivery price | Opening price on last trading day | Contract price in second morning session |
A. Trading Hours
Trading on the last trading day of the current contract month will be closed on the completion of the morning session (9:00 to 11:00).
B. Settlement Price
The opening price of the current contract month for the last trading day will be the settlement price on that day.
(On any other day, the closing price for that day will be the settlement price for the same day.)
Example
| Opening price | High price | Low price | Closing price | Settlement price |
| 138.5 | 139.8 | 137.5 | 138.0 | 138.5 |
C. Delivery Price
The delivery price will be the final settlement price for the current contract month, that is, the opening price for the last trading day.
(3) Precautions for Trading on the Last Trading Day of the Current Contract Month
A. After the opening price is determined, trading on the last trading day of the current contract month is still possible until 11:00. If no offsetting trade is made until the end of the morning session, the position will be settled by physical delivery. Therefore, if you do not wish your trade to involve physical delivery, place a market order by the start of the session to initiate an offsetting trade. The market order placed before the opening Itaawase will be executed when the opening trade is done.
B. Market orders at closing, limit market orders, stop orders, and stop limit orders cannot be placed on the last trading day of the current contract month so as to prevent positions from inadvertently being settled by physical delivery.
(4) Settlement by Delivery
If you wish to settle your trade by physical delivery, please make delivery arrangements by 5:00 PM on the business day prior to the last trading day. Unless these arrangements are made, the transaction will be settled by an offsetting trade when the opening price for the last trading day is determined.
The following change will be made to the rules for brokerage operations concerning settlement by physical delivery.
| Systems trading (new) | Itayose trading (old) |
If a customer settling a trade by physical delivery does not submit the warehouse receipt or price in full for the trade to the broker, or does not inform the broker of such arrangements by 5:00 PM on the business day prior to the last trading day of the contract month, the broker will dispose of the trade when the contract price is determined at the start of the trading session on the last trading day of the month. |
If a customer settling a trade by physical delivery does not submit the warehouse receipt or price in full for the trade to the broker, or does not inform the broker of such arrangements by 10:00 AM on the business day prior to the last trading day of the contract month, the broker will dispose of the trade in the final trading session of the last trading day of the month. |
2. Precautions Regarding the Revision of the Contract Unit
(1) Revision of the Contract Unit
The contract unit will change on January 26, 2005, from 10,000 kg to 5,000 kg, for new contract months beginning July 2005.
(2) Precautions Regarding the Difference between Contract Unit and Delivery Unit
The contract unit (5,000 kg) will be different from the delivery unit (10,000 kg) for new contract months beginning July 2005.
When deciding on the number of contracts and placing an order for a position that will be due at the closing time (11:00) of the morning session on the last trading day of the current contract month in and after July 2005, make sure that the number of outstanding position is an integral multiple of the delivery unit.
