As open outcry futures trading has fallen to just one percent of the company’s total futures volume, CME Group Inc (NASDAQ:CME) today announced it will close most of its futures trading pits in Chicago and New York by July 2, 2015.
This decision demonstrates that analog methods of conducting business, plus one of the most widely known trademarks of trading floors at stock exchanges and marketplaces – shouting – may soon become a thing of the past, to be completely replaced by the millimetric precision and silence of electronic execution systems.
The floor-based S&P 500 futures market, which continues to provide an important venue for trading the underlying futures contract for the open outcry S&P 500 options on futures contract, will remain open on CME Group’s Chicago trading floor.
Options on futures contracts, which continue to trade actively on both the floor and the screen, will remain open on both trading floors except for the DJIA ($10) and NASDAQ-100 open outcry equity index options markets which are designed to deliver into floor-based futures contracts.
With the exception of the S&P 500 futures and options on futures pits which will remain open, equity index futures pits and the DJIA ($10) and NASDAQ-100 options pits will close following the expiration of the June 2015 contract on June 19, 2015. All other futures pits will close on July 2. In addition, in Chicago, all options pits will be located on a single floor in the company’s Financial Room by September.
To assist floor traders with the transition going forward, the company will make every attempt to make booth space available to those who want to trade electronically following the closure of the open outcry futures pits.
CME Group will hold members’ meetings in Chicago and New York to answer questions and discuss transition plans. Only current member owners will be admitted.
For the official announcement from CME Group, click here.