VerticalNet, a component of the FORTUNE e-50 Index, is a leading portfolio of online business-to-business communities of commerce.
The CME was the first exchange licensed by FORTUNE to develop derivative products based on its indexes. "We welcome the CEO of one of the pace-setting companies in B2B commerce to launch these new futures contracts on the FORTUNE e-50 Index," CME Chairman Scott Gordon said. "The addition of FORTUNE e-50 futures to the CME's comprehensive line of equity index products will give our customers the ability to further enhance their investing and risk management capabilities."
"FORTUNE is pleased to have joined forces with the world's premier futures marketplace in the launch of this exciting product," said Jack Haire, President of the FORTUNE Group. "We believe that the FORTUNE e-50 Index gives investors the best tool with which to measure the full promise of the new economy."
"We are honored to represent the FORTUNE e-50 today at the Chicago Mercantile Exchange," said Joseph Galli, Jr., President and CEO of VerticalNet, Inc. "With its e-50 Index, FORTUNE has captured the best-of- breed in each industry sector that represents the new economy. And, by trading these futures through the CME, investors can now attain the combined enormity of these companies which are creating the Internet revolution."
"FORTUNE is one of the most respected brand names in business, and we are delighted to bring the FORTUNE name to the CME marketplace," said Jim McNulty, President and CEO of the Chicago Mercantile Exchange. "Customers have eagerly anticipated today's launch of the FORTUNE e-50 futures on the CME."
Other officials attending the ceremony included Peter Petre, Executive Editor of FORTUNE and Leo Melamed, CME Chairman Emeritus and Senior Policy Advisor.
Trading in FORTUNE e-50 Index futures is available virtually 24 hours a day on the CME's GLOBEX®2 electronic trading system, from 3:45 p.m. (Central Time) until 3:15 p.m. the following day. Trading via the Internet will be available through numerous futures brokerage firms.
The FORTUNE e-50 Index is designed by the editors of FORTUNE magazine to track the performance of companies shaping the Internet economy and includes firms that generate a significant share of their revenues from online products or services, as well as those that provide and maintain the Internet infrastructure.
FORTUNE e-50 Index futures contracts are expected to appeal to individual investors who want to participate in the Internet sector, as well as institutions using the product for risk management or asset allocation purposes. They offer market participants the ability to gain exposure to the Internet economy with just one trade, at a fraction of the cost of investing in all of the underlying stocks in the index. The CME Clearing House acts as guarantor to each trade executed on the exchange.
The FORTUNE e-50 Index is a modified market capitalization weighted index incorporating four subsectors of the Internet market-"e-companies," such as VerticalNet, Yahoo! and 17 other companies; 15 net software and service companies, led by Microsoft, 12 net hardware companies, including IBM; and four net communications companies, such as AT&T and MCI WorldCom.
Each FORTUNE e-50 futures contract is sized at $20 times the index, or $20,000 as of the calibration of the index at 1000.00 at the close of trading on Dec. 31, 1999. At launch, the initial performance bond (margin) to trade each contract has been set at $1,625. The cash-settled contracts will expire quarterly in the March quarterly cycle and will have a minimum price fluctuation (tick) of 0.50 index points equal to $10.00. Real-time values are calculated every 15 seconds during the trading day. Further details on the index and its composition are available on FORTUNE's Web site at http://indexes.fortune.com. The CME has established a FORTUNE e-50 Resource Center on its Web site at www.cme.com.
The FORTUNE Group at Time Inc. is comprised of FORTUNE, FSB: FORTUNE Small Business and eCompany Now, and is part of the Time Warner family of companies.
The Chicago Mercantile Exchange introduced the world's first successful stock index futures in 1982 with the S&P 500 Stock Index contract, with Nasdaq 100 futures and options joining its product line-up in 1996. With the 1997 introduction of the E-miniS&P 500-electronically traded contracts geared toward individual investors-the exchange reinvented index trading. That product quickly grew to become the CME's third largest futures contract and inspired the 1999 launch of E-mini Nasdaq 100 futures. Together, the E-mini equity index contracts, also accessible through many brokerage firms via the Internet, are the fastest growing products in the history of the exchange.
The Chicago Mercantile Exchange also trades futures and options on futures on foreign currencies, interest rates and agricultural commodities.
VerticalNet owns and operates 57 industry-specific Web sites designed as on-line business-to-business communities, known as vertical trade communities. These vertical trade communities provide users with comprehensive sources of information, interaction and e-commerce. Each of VerticalNet's communities is individually branded, focuses on one business sector and caters to individuals with similar professional interests. VerticalNet also provides a comprehsensive end-to-end e-commerce platform for the building of Neutral Net Markets.
