| Cabinet price |
Nominal price for liquidating deep-out-of-the-money options contracts. Defined as the lowest possible tradable price for this option, and is determined within the Clearing System. Trades on options done at a price equal to zero are considered cabinet trades. |
| Cabinet Trade (cab) |
A trade that allows options traders to execute deep out of the money options by trading the option at a price less than the minimum tick (based on the minimal allowable tick convention). |
| Calendar spread |
The selling (buying) of a nearby futures, options (put or call), or forward contract and the simultaneous buying (selling) of a deferred futures or options contract with the same strike price. See futures calendar spread and options calendar spread. |
| Call |
An option to buy a commodity, security or futures contract at a specified price any time between now and the expiration date of the option contract. |
| Call option |
A contract between a buyer and seller in which the buyer pays a premium and acquires the right, but not the obligation, to purchase a specified futures contract at the strike price on or prior to expiration. The seller receives a premium and is obligated to deliver, or sell, the futures contract at the specified strike price should a buyer elect to exercise the option. Also see American Style Option and European Style Option. |
| Call profit/loss |
For a long call, eFor a long call, equal to the call value minus the premium. For a short call, equal to the premium minus the call value.qual to the call value minus the premium. For a short call, equal to the premium minus the call value. |
| Call value |
At expiration, equal to the futures price minus the strike price of the call. |
| Car |
A contract or unit of trading. Originally, one contract, or "car," was the quantity of a commodity that would fill a railroad car. See also lot. |
| Carrying firm |
A firm that carries on its books positions that were executed by it or by another firm. |
| Carryover |
Last year's ending stocks of a storable commodity. |
| Cash commodity |
The actual or physical commodity, as distinguished from a futures contract. |
| Cash for futures |
See Exchange For Physicals. |
| Cash price |
Current market price of the actual or physical commodity. Also called the spot price. |
| Cash sales |
The sale of commodities in local cash markets such as elevators, terminals, packing houses and auction markets. |
| Cash settlement |
Final disposition of open positions on the last trading day of a contract month. Occurs in markets where there is no actual delivery. |
| CBOT |
Acronym for the Board of Trade of the City of Chicago, Inc. |
| CCTV |
Closed Circuit Television devices in office towers displaying latest pricing information. |
| Central Bank |
A government bank that regulates a country's banks and manages a nation's monetary policy. The Federal Reserve is the central bank in the United States, whereas the European Central Bank (ECB) is the central bank of the European Monetary Union. |
| Certificate of Incorporation |
The Certificate of Incorporation of Chicago Mercantile Exchange Inc. unless otherwise specified. |
| CFMA |
Commodity Futures Modernization Act of 2000. |
| CFO Order (Cancel Former Order) |
A cancellation or change in the quantity or price of a previously entered order. |
| CFTC |
Acronym for the Commodity Futures Trading Commission as created by the Commodity Futures Trading Commission Act of 1974. This government agency regulates the nation's commodity futures industry. |
| Charting |
The use of graphs and charts in the technical analysis of futures and options markets to plot trends of price movements, average movements of price, and volume and open interest. |
| Chartist |
One who engages in technical analysis. |
| Chicago Mercantile Exchange Holding INC. |
A holding company of which CHICAGO MERCANTILE EXCHANGE INC. is a wholly owned subsidiary. |
| Class A Share |
A share of Class A Common Stock of Chicago Mercantile Exchange Holdings Inc. Class A Shares confer no trading rights. |
| Class B clearing member |
A non-bank member firm whose privileges and rights are limited to conducting proprietary arbitrage in foreign currencies with a single exchange-approved bank (See "clearing member" for details). |
| Class B Common Stock |
The Class B Common Stock of the exchange in the various series that have been issued. |
| Class B Share |
A share of Class B Common Stock of Chicago Mercantile Exchange Holdings Inc. A Class B Share may be transferred only in accordance with the Rules. |
| Class B Stockholder |
The registered owner of one or more Class B Shares. |
| Class code or transition class |
Equivalent to 'group/instruments' which groups an instrument's futures and options (e.g., CME Eurodollar futures (GE) and CME Eurodollar options (ZE); or CME British Pound Futures (BP) and CME British Pound Options (OP) separately (calls and puts are not separate). |
| Clearing |
The procedure through which CME Clearing becomes the buyer to each seller of a futures contract, and the seller to each buyer, and assumes responsibility for protecting buyers and sellers from financial loss by ensuring buyer and seller performance on each contract. This is effected through the clearing process, in which transactions are matched, confirming that both the buyer's and the seller's trade information are in agreement. |
| Clearing 21 |
The real-time (trade and position processing) clearing system. (Also referred to as C21). |
| Clearing fee |
A fee charged by the exchange for each contract cleared. There are also clearing fees associated with deliveries, creation of a futures position resulting from an option exercise or assignment, Exchange for Physicals (EFP), block trades, transfer trades and adjustments. Fees may be waived or reduced for some commodities as specified by the Board of Directors from time to time. |
| Clearing Fee Indicator |
A designation on a trade record which indicates the rate to be paid for clearing services: E = Equity Members, Clearing Members*; L = Lessee/106.F.Employees; B = CBOE Member (trading S&P products only); H = 106.H./J. Firms; C = Non-member (customer); M = Member rate for futures side of BK broker combination trades.* A 106.F member, who is an owner of a clearing member firm and whose seat is assigned for clearing privileges, is entitled to equity rates and therefore should use the E fee code. If fee is left blank, your rate will be determined based on user affiliation and the CTI code. |
| Clearing firm |
A firm approved to clear trades through CME Clearing. Class A clearing firms are approved to clear transactions for all commodities. See also clearing member. |
| Clearing House |
An agency or separate corporation of a futures exchange that is responsible for settling trading accounts, collecting and maintaining margin monies, regulating delivery and reporting trade data (i.e., CME Clearing is the clearing house for CME). |
| Clearing ID |
The alpha-numeric firm ID under which the firm’s trades will clear. |
| Clearing keys |
Combination of account number, origin, CTI, clearing fee, foreign exchange/firm and memo fields, when defined, automatically populates the order entry box fields in the CME Globex system. |
| Clearing member |
A firm qualified and approved to clear trades through the CME clearing house. All clearing members not specifically designated as Class B members are considered Class A clearing members. There are three categories of clearing members:1) CME clearing members, qualified to clear transactions for all commodities;2) IMM clearing members, qualified to clear trades for only IMM and IOM commodities; and3) IMM Class B clearing members, solely limited to conducting proprietary arbitrage in foreign currencies between a single exchange-approved bank and the IMM, and who must be guaranteed by one or more Class A non-bank CME or IMM clearing member(s). |
| Clearing non-trade transaction |
Composed of transfers, exchange-for-physicals (EFPs), blocks and give-ups. Transfers, blocks and EFPs are privately negotiated, ex-pit transactions, while give-ups relate to post-trade processing. "Cancels" and "replaces" do not generate clearing non-trade transactions. |
| Clearing trade transaction |
Each matched trade between a buyer and a seller generates two clearing trade transactions: one for the buyer and one for the seller. |
| Clerk |
A member's bona fide employee who has been registered by the exchange to work on the trading floor. |
| Close |
The period at the end of the trading session officially designated by the exchange during which all transactions are considered "made at the close." Sometimes used to refer to the closing range. |
| Closing Bell |
Any signal which indicates the conclusion of normal daily trading hours in any commodity. |
| Closing price |
The last price of a contract at the end of a trading session. |
| Closing range |
The high and low prices, or bids and offers recorded during the period designated by the exchange as the official close of trading in a given pit (the final 60 seconds of trading in currencies and 30 seconds in all other contracts). |
| CME |
Chicago Mercantile Exchange Inc. |
| CME Clearing |
The division of the exchange through which trades are cleared, settled, and guaranteed. |
| CME Division |
The Chicago Mercantile Exchange Division of the exchange. Holders of the membership interest associated with Chicago Mercantile Exchange Holdings Inc. Class B-1 Stock, who have been elected to membership, are members of the CME Division. |
| CME Globex |
CME's electronic order entry and matching system that allows traders to enter orders into the system and which matches all orders based on price and time priority. |
| CME Globex Order Duration Qualifiers |
CME Globex order duration qualifiers allow traders to indicate how long the order will be valid – for example, if it should remain open for the next trading session if it isn’t executed by the end of the trading session in which it was entered. An order submitted without an order duration qualifier will be eliminated at the end of that same trading session if not filled or, if it was received between trading sessions, at the end of the following session. As with order types, not all order duration qualifiers are available for all CME products. To view supported order duration qualifiers by product line, click here. |
| CME Globex Order Types |
The CME Globex platform supports a broad array of order functionality, offering convenience and flexibility to meet a variety of individual trading needs. The availability of specific order types varies based on the markets, products and trading applications. To view supported order types, click here. |
| CME Globex Terminal Operator |
An individual who is authorized to enter orders through a CME Globex connection. |
| CME Globex Trader |
Front-end trading application that connects a user either directly or via the Internet, to the CME's electronic trading platform. |
| CME Globex Trading Hours |
Those hours designated by the CME Board of Directors for trading through CME Globex for particular contracts. |
| CME Globex user ID |
An identifier assigned to access the CME Globex electronic trading engine. |
| CME SGX Mutual Offset System (MOS) |
In 1984, CME, in partnership with the Singapore Exchange (SGX), pioneered an innovative approach to futures trading known as the Mutual Offset System (MOS). Through the MOS, contracts opened on one exchange can be liquidated or held at the other. The CME-SGX link effectively extends the trading hours of both exchanges beyond their operating hours, allowing traders to better manage their overnight risk. This agreement, the first international futures trading link of its kind, is available for both Eurodollar and Euroyen futures. |
| Code reviews |
An assessment of the application logic and scripts to verify that code meets standards of modularity, comments, variable usage, and process branching. A code review is the most important part of the exit criteria of the code phase. An inspection is performed to approve or critique that an application's logic meets formal expectations concerning naming conventions, routine/object modularity, variable usage, operand usage, and processing efficiency. |
| Combination Order |
A combination of buy and/or sell orders for the same account, except as provided by Rule 551, at the market or at a fixed differential or by some other appropriate pricing convention. |
| Commission |
For futures contracts, the one-time fee charged by a broker to cover the trades a client makes to open and close each position. It is payable when the client exits the position. Also called a round-turn. Commissions on options are usually half on initiation and paid half on liquidation. |
| Commitment |
When a trader or institution assumes the obligation to accept or make delivery on a futures contract. |
| Commodity |
The underlying instrument upon which a futures contract is based. |
| Commodity code |
A unique symbol used to identify a particular commodity traded on CME for purposes of submitting data into the Clearing System. This code should not be confused with the ticker symbol, which is the code denoting which commodity price is being quoted. |
| Commodity exchange |
An exchange that lists designated futures contracts for the trading of various types of derivative products and allows use of its facilities by traders. Must comply with rules set forth by the Commodity Futures Trading Commission (CFTC). |
| Common Currency |
Currency that is eliminated when calculating a cross rate between two currencies when their exchange rates are expressed in terms of the common currency; normally the US dollar. |
| Contract |
An agreement to buy or sell an exchange specified amount of a particular commodity or financial instrument at a specified price. Also, a term of reference describing a unit of trading for a commodity future, as in "5 Lean Hog contracts."The contract specifications detail the amount and grade of the product and the date on which the contract will mature and become deliverable if it is not liquidated, or offset, earlier. |
| Contract administration |
The practice of managing the relationship with a particular service provider. |
| Contract close-out |
Completion and settlement of the contract, including resolution of all outstanding items. |
| Contract Month/Year |
The month and year in which a given contract becomes deliverable if it is not liquidated or offset before the date specified for termination of trading of that contract month. Also called the delivery month. |
| Contract Size |
The eligible size of a commodity that can be traded by the futures contract. |
| Controlled account |
Any account for which trading is directed by someone other than the owner. |
| Cooling Degree Day (CDD) |
A day in which the average daily temperature is more than 65 degrees Fahrenheit, and therefore likely to be a day in which people turn on their air conditioning. A Cooling Degree Day is assigned a value that represents the number of degrees that day's average temperature exceeds 65 degrees. For example, if a day's average temperature is 85 degrees, the CDD value for that day would be 20 (85 â€" 65). If the average temperature is less than or equal to 65 degrees, the CDD value for the day would be zero. (The day would not be sufficiently warm enough to require air conditioning.) |
| Corporate events |
A term used to describe certain types of actions taken by a company's governing board that directly affect the valuation of the company's stock. Actions classified as Corporate Events include stock splits, extraordinary dividends, rights offerings, mergers, spin offs, tender offers, and certain other types of transactions. In some cases, derivatives exchanges must make adjustments to contract specifications with regard to Corporate Events to ensure continuity in the markets for the relevant derivative securities. |
| Corporation |
An entity created by or under the authority of the laws of a state or foreign corporation statute or limited liability company ("LLC") statute. References in the Rules of the exchange to shareholders shall also be deemed to refer, in the case of an LLC, to LLC members; references to equity securities shall also be deemed to refer, in the case of an LLC, to LLC membership interests; and references to officers or directors shall also be deemed to refer, in the case of an LLC, to LLC managers. |
| Cost risk |
The risk associated with project cost growth, or increased cost of one project requiring a reduction in the cost of another project. |
| Country risk |
Risk associated with an FX (foreign exchange) transaction, referring to potential political or economic instability. |
| Covered Call |
Position where a call option is sold in concert with a long position in the futures contract |
| Credit spread |
An option spread in which there is a net collection of premium. |
| Cross margining program |
A program that allows certain joint and affiliated clearing firms to receive margin credit for designated contracts across different clearing organizations. |
| Cross rate |
The exchange rate between two currencies, in which the home country's currency is not included. In the U.S., the euro/yen rate would be considered a cross rate, while in Europe or Japan it would be considered a primary pair. |
| Cross trading |
Matching of the buying order of one customer against the selling order of another, a practice that is permissible only when executed as required by CME Rule 533, CFTC Regulations and CME Rulebook. |
| CTE |
Central Trading Engine or host. |
| CTI |
Customer Type Indicator (as it pertains to electronic trading systems): A clearing indicator, required at the time of order entry, which indicates for whom the order is being entered: CTI 1 = Applies to orders entered by a workstation user for his/her own account or an account in which he/she has financial interest. CTI 2 = Applies to orders entered for the proprietary account of the clearing firm. CTI 3 = Applies to orders entered by a member, an ETH permit holder, or by an employee of a member or ETH permit holder, for the account of another member or ETH permit holder (Rule 574.B.) CTI 4 = Applies to all other orders that do not fit the above three categories. |
| CUBS |
CME-specific application for electronic trading. |
| Cultural risk |
Risk arising from long-standing embedded process and procedures, or from experienced based bias. |
| Cumulative Degree Day |
The sum of the daily Heating Degree Day (HDD) or Cooling Degree Day (CDD) values over a specified period, usually a month or a season. This value would also be the number recorded in that month's or season's HDD or CDD Index value. |
| Currency risk |
The potential for a shift in exchange rates, which would be detrimental to a trader's position. |
| Current delivery month |
The delivery month that typically identifies the futures contracts that expire within that month. |
| Current Yield |
A term used frequently in bond transactions. Current yield is computed by dividing the annual amount of interest by the price paid for the bond or security. If the security is purchased at a discount from the par or principal value, the current yield with be higher than the stated interest or coupon rate. |
| Customer |
A designation that refers to segregated clearing member firm trading activity. Customer trading activity and funds may not be combined with non-segregated house activity within a clearing member firm. |