CME will launch futures contracts on three of the largest and most actively traded Exchange Traded Funds (ETFs) in the U.S.
New CME ETF futures contracts on NASDAQ-100 Index Tracking Stock (ticker: QQQQ), S&P 500(R) Depositary Receipts (ticker: SPY) and iShares Russell 2000 (ticker: IWM) are scheduled to begin trading on the exchange’s CME Globex electronic trading platform on June 6, 2005. The futures on the S&P 500 and NASDAQ-100 will trade exclusively at CME.
“With today’s announcement, we are bringing together two of the most successful financial product innovations in the last decade, the CME E- mini stock index futures and ETFs,” said CME Chairman Terry Duffy. “More than 92 percent of all U.S. equity index derivatives trading takes place at CME. With more than $82 billion in assets under management, the S&P 500, NASDAQ-100 and Russell 2000 EFTs are the largest, most well-known ETFs in the U.S. With the launch of these new ETF futures, we are continuing to build on our success in developing innovative new products to meet the needs of investors while providing more value for our shareholders.”
While CME currently offers both a standard size and an “E-mini” size contract on all three indexes, the new ETF futures will have a significantly smaller notional value of one-fifth of the CME E-mini contract. The S&P 500 Depositary Receipts futures contract will have a notional value of approximately $11,600, the NASDAQ-100 futures contract will have a notional value of approximately $7,000 and iShares Russell 2000 futures will reflect a notional value of approximately $12,300. With the smaller size, these contracts are designed to appeal to sophisticated individual investors. Unlike CME’s other equity products, which are cash settled.