Interview with CME Group's Derek Sammann: E-Micro Products

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Here is a transcript of a recent video on INO TV. The CME Group's Managing Director, Derek Sammann

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“New CME FX E-Micro Product” - Interview with the CME Group’s Derek Sammann


“FX over the last couple of years has really emerged into an asset class in and of itself. As the equity markets have been difficult and highly volatile, we found a broader set of customers really
looking for additional asset classes to trade to try to define trading strategies where they can make money. FX has been a beneficiary of that. So we’re finding that with our FX suite, we’re moving beyond our typical institutional base. But, even amongst that institutional user set, we’re finding people trading the product because we’re seeing more retail influence on the product, and because we have more retail influence in the product, we get to grow our customer base on the institutional side. It’s a very symbiotic relationship and the beautiful thing about our product suite, whether it’s the mini, the micros or the large contracts, is they all settle the exact same way, they’re consistent with each other, and they’re fungible. So, if your a large customer who wants to be able to provide liquidity in a small contract, the risk is fungible across whatever contract you trade. It’s a daily settlement, they all settle with the same price, and the access to the pricing is as it is now… over Globex, through a FCM, or a broker....”


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2 thoughts on “Interview with CME Group's Derek Sammann: E-Micro Products

  1. Andrew,

    Keep reading... Sammann addresses the exact issue you are referring to.

    "What are the benefits of e-micro contracts?
    “Our suite of micro products are really appropriately sized and really the beneficial aspects of the products are the investor’s safeguards that you get trading on exchange. When a typical retail trader trades in the cash market, they’re exposed to counter-party risk of that principle counter-party. When you trade on exchange, your counter-party is the CME clearing house that’s back by $8 billion financial safeguards package. Secondly the products are able to be traded alongside our large contracts and with average daily volume in excess of $100 billion a day in our futures pool, what that means is that this is the first time the retail trader trading a small appropriate size contract can benefit from the liquidity of $100 billion a day and be able to size his particular risk in a contract size that benefits from the liquidity of available to him.”

    What was the reason behind introducing e-micros now?
    “The micro concept really came about as a result of direct coordination and communication with our brokers, our customers, our client base. What they’ve told us is, “we would like to trade your products more than we do.” We would like to have a broader access to a broader customer base, but as part of our engagement process in customer service, we have to go where the customer calls us to. So really the impetus behind the rollout for the micros was to be able to appropriately size a contract spec where we know there is an existing client demand and where those clients are currently being undeserved. The concept of the micro size concept takes the best of our deep liquidity in our overall futures liquidity pool here at CME and applies that in the appropriately sized, bite size chunks. That really is a process of working with our channel partners, our brokers and our customers who simply say, ‘I’d like an extension of the product, but one a little more appropriately sized.’”


    Lindsay Thompson
    Director of New Business Development & MarketClub

  2. How to trade E-Micro if that has ZERO liquidity ?!:)))))))))))
    CME apart from biggest forex dealers can not provide Eminies with "NORMAL" liquidity.

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