An EFR is an ex-pit transaction that involves the exchange of a futures position for an over-the-counter (OTC) position. These transactions provide market participants a way to initiate or unwind existing or new OTC positions and are acceptable for OTC derivatives that have a reasonable price correlation to the NCI or NSI futures contracts.
"NCI and NSI futures offer unique price protection opportunities for a wide range of users, including over-the-counter derivative providers," said Ray Lottie, chairman of the MGEX board of directors and manager of cereal and eastern grain operations for General Mills. "The Exchange For Risk feature will make our financially settled corn and soybean contracts even more user-friendly for OTC providers and their customers."
NCI and NSI futures and options were launched in February 2002 on MGEX's electronic trading platform, MGEXpress®. The exchange is adding financially settled Hard Winter Wheat Index (HWI) futures and options to its portfolio of electronically traded products on May 9, 2003.
MGEX, established in 1881, is the only market for hard red spring wheat, NSI and NCI futures and options. For more information about MGEX, visit www.mgex.com.
