Derivatives marketplace operator CME Group Inc (NASDAQ:CME) today announced it is launching Wednesday Weekly FX options (Wednesday options) due to customer demand and significant growth in existing Weekly FX options, which expire on Friday.
Wednesday options will be available in premium quoted and volatility quoted European style options with a 2 p.m. CDT fix on five major currency pairs: AUD/USD; GBP/USD; CAD/USD; EUR/USD; JPY/USD. Wednesday options will be available for trading and clearing on October 30, 2017, pending regulatory approval.
Market participants trade weekly options to more precisely manage currency risk during the week. Existing FX Weekly options average daily volume reached a new record of 31,990 contracts in September 2017, which is up 76.6 percent compared to the same time period last year.
Paul Houston, CME Group
Our clients want to further refine their exposure to mid-week announcements from the Federal Reserve, Bank of Canada and Reserve Bank of Australia’s meetings before the end of this year,” said Paul Houston, Global Head of FX at CME Group. “More broadly, as event-related trading activity continues to grow, they are looking for the additional granularity of these short-dated FX weekly options, as well as the ability to leverage capital efficiencies and spreading opportunities available in our markets.
CME Group has successfully launched Wednesday Weekly options in other asset classes as well. For example, after launching in June 2017, Wednesday Weekly Treasury options have traded more than 1.1 million contracts. Amid ongoing geopolitical uncertainty, market participants continue to turn to CME Group’s diverse product suite to manage risk.
Wednesday options will be listed with and subject to the rules and regulations of the Chicago Mercantile Exchange.