Chicago Mercantile Exchange (CME) has added new functionality alongside discounts for electronically traded options on futures.
Starting 25 March, CME Globex will feature user-defined spreads, which allow traders to create a spread if the exchange does not already offer it. The new functionality applies to options on CME interest rates, equities, FX and commodities. CME began offering user-defined spreads last July on Eurodollar futures and options, when it introduced functionality for covered, or delta neutral spreads. Since then, over 550,000 contracts have traded in covered transactions on Globex across all CME products groups.
Electronic options volumes on CME averaged 123,000 contracts daily in 2006 and represented 13% of the overall options volumes.
CME also announced improvements to its CME EOS Trader, the exchange's Internet-based trading application. The system allows for access to the options platform and now offers enhancements such as credit controls and a shared order book.
In addition, CME will offer a variety of pricing incentives beginning on 1 May for transaction fees on options traded through Globex. These discounts will run until year end and vary by product group. Eurodollar option fees for members will be cut to $0.15, from $0.25, and to $0.25 from $0.55 for non-members. E-mini S&P 500, Nasdaq 100 and Russell 2000 options fees will be capped at $200 per day for members and priced at $0.16 for non-members. FX options fees for non-members will be slashed to $0.25 from $1. And livestock options fees will be cut to $0.25 from $0.50 for members and to $0.65 from $1.25 for non-members.