"We have been pleased with the Eagle mock trading sessions we have conducted with our customers over the past two weeks in our user test environment," said Scott Johnston, Managing Director and Chief Information Officer. "Production simulation using the full GLOBEX system on two occasions will provide both CME and its customers the opportunity to evaluate the full effect of the enhancements in advance of the launch."
Eagle (an acronym for Electronic Arbitrage GLOBEX Liquidity Enhancer) is designed to enable CME customers, for the first time, to trade Eurodollar calendar spreads on GLOBEX in a way that replicates how those same spreads trade in the open outcry environment. Eagle will enable customers to execute trades electronically in the first eight quarterly expirations and 22 corresponding calendar spreads in Eurodollar futures, increasing liquidity on the GLOBEX system by creating implied prices for outright futures and spreads.
Following the launch of Eagle in Eurodollars, the new technology will be rolled out to the exchange's other electronically traded products in the coming months. In a second release planned for later next year, the Eagle Project will accommodate additional Eurodollar trading strategies, including "packs," "bundles" and "butterflies."
Each CME Eurodollar futures contract represents an interest rate on a three-month deposit of 1 million U.S. dollars. CME trades quarterly contract expirations on Eurodollars extending out 10 years in the future, allowing customers to extend their short-term interest rate risk management for 10 years. Eurodollars are the world's most actively traded futures contract as measured through October 2002.
Chicago Mercantile Exchange Inc. is the largest futures exchange in the United States and the second largest exchange in the world for the trading of futures and options on futures. As an international marketplace, CME brings together buyers and sellers on its trading floors and GLOBEX around-the-clock electronic trading platform. CME offers futures contracts and options on futures primarily in four product areas: interest rates, stock indexes, foreign exchange and commodities. The exchange moves about $1.7 billion per day in settlement payments and manages $27.7 billion in collateral deposits. CME is a wholly owned subsidiary of Chicago Mercantile Exchange Holdings Inc.
