CHICAGO, Oct. 23 /PRNewswire-FirstCall/ -- CME Group, the world's largest and most diverse exchange, and the Korea Exchange (KRX), a premier capital market place for Northeast Asia, announced today that they intend to enter into an agreement for the KOSPI 200 futures contract to be listed on CME Globex(R), the electronic trading platform of CME Group, beginning in 2008. The terms of the proposed five-year agreement will include the creation of a telecom hub in Seoul and would mark the first time KRX has embarked on a third-party agreement for its popular KOSPI 200 product.
A signing ceremony of the proposed terms with Korea Deputy Prime Minister O-Kyu Kwon and officials from both exchanges will be held on Wednesday at the Chicago Mercantile Exchange building.
More than 32 million KOSPI 200 futures, based on the KOSPI 200 stock index of the largest South Korean companies as measured by market capitalization, traded through August of 2007. Under the proposed agreement, CME Group will match the trades, with KRX continuing to clear and settle their products.
The contract, which will trade from 2:00 a.m. to 3:00 p.m. Chicago time, or 5:00 p.m. to 6:00 a.m. Seoul time, will be offered on the same platform as CME Group products, including derivatives on: Eurodollars; U.S. Treasury bonds and notes; the S&P 500(R), NASDAQ-100(R), Dow Jones Industrial Average(SM), and MSCI EAFE(R) stock indexes; foreign exchange; grains; livestock; weather; real estate and more.
"The addition of the Korea Exchange's KOSPI 200 contract onto CME Globex will be an important part of our continued global expansion," said CME Group Executive Chairman Terry Duffy. "CME Globex is the one trading platform that provides market users with access to all of the major asset classes. The addition of the KOSPI 200 futures will offer yet another key market to our electronic trading customers worldwide."
"Our proposed agreement with the Korea Exchange is a prime example of how CME Group is further extending its reach into the Asia marketplace," said CME Group Chief Executive Officer Craig Donohue. "The Asia region is a vital area of long-term growth for both our products and our transaction processing services. We look forward to adding the KOSPI 200 futures to CME Globex, enabling this benchmark product to benefit from the speed, reliability and transparency of our industry-leading platform."
"The Korea Exchange has done a remarkable job growing its business and helping to develop the capital markets in Northeast Asia," said Leo Melamed, CME Chairman Emeritus. "We look forward to working with KRX and providing even more accessibility to their markets."
"Opening a night session with CME Group will help us greatly in globalizing the KRX," said KRX Chairman and Chief Executive Young-Tak Lee. "This proposed agreement will open up the prospect for our two exchanges to explore together the ocean of opportunities in Asia, as well as to lead the further advancement of global derivatives markets."
In January, electronically traded products at the Chicago Board of Trade, now part of CME Group, will move to CME Globex, save metals.
CME Group and KRX are working toward signing the definitive agreement. The proposed transaction will only proceed if the parties sign a definitive agreement. There can be no assurance that any definitive agreement will be signed.
CME Group (http://www.cmegroup.com) is the world's largest and most diverse exchange. Formed by the 2007 merger of the Chicago Mercantile Exchange (CME) and the Chicago Board of Trade (CBOT), CME Group serves the risk management needs of customers around the globe. As an international marketplace, CME Group brings buyers and sellers together on the CME Globex electronic trading platform and on its trading floors. CME Group offers the widest range of benchmark products available across all major asset classes, including futures and options based on interest rates, equity indexes, foreign exchange, agricultural commodities, and alternative investment products such as weather and real estate. CME Group is traded on the New York Stock Exchange and NASDAQ under the symbol "CME."
The Globe logo, CME, Chicago Mercantile Exchange, CME Group, Globex and E-mini, are trademarks of Chicago Mercantile Exchange Inc. CBOT and Chicago Board of Trade are trademarks of the Board of Trade of the City of Chicago. Standard & Poor's, S&P 500 and S&P, S&P MidCap 400, Standard & Poor's Depositary Receipts and SPDR are trademarks of The McGraw-Hill Companies, Inc. NASDAQ, NASDAQ-100 and the NASDAQ-100 Index are trademarks of The Nasdaq Stock Market, Inc. Nikkei and Nikkei 225 are trademarks of Nihon Keizai Shimbun Inc. The Russell 2000 Index and Russell 1000 Index are registered trademarks of Frank Russell Co. TRAKRS and Total Return Asset Contracts are trademarks of Merrill Lynch & Co., Inc. GSCI is a trademark of Goldman Sachs & Co. Morgan Stanley Capital International, MSCI, and EAFE are trademarks of MSCI. FTSE/Xinhua China 25 is a trademark of FTSE Xinhua Index Limited. Dow Jones and Dow Jones Industrial Average are trademarks of Dow Jones & Company, Inc. CDR Liquid 50 NAIG is a trademark of Credit Derivatives Research LLC. These trademarks are used herein under license. All other trademarks are the property of their respective owners. Further information about CME Group and its products can be found at http://www.cmegroup.com.
Korea Exchange Inc., established in January 2005 through the merger of the Korea Stock Exchange (KSE), the Korea Futures Exchange (KOFEX), the KOSDAQ Market, and the KOSDAQ Committee, is the sole exchange in the Republic of Korea. The KRX operates the centralized securities and derivatives markets where stocks, bonds and derivatives are traded on a common platform. To best serve its clients, the KRX provides its customers with the full access to both cash and derivatives markets, and clears and settles all transactions on its markets as one-stop service. KRX offers diverse derivatives products primarily in the following areas: individual stocks, stock index, bond/interest rate, foreign currency and commodities. According to the 2006 statistics compiled by Futures Industry Association, KOSPI 200 options is the most heavily traded one in the world in terms of trading volume with 2.4 billion contracts.
Korea Exchange, KRX, KOSPI and KOSPI 200 are registered trademarks of Korea Exchange Inc. Further information about KRX and its products can be found at http://www.krx.co.kr
Statements in this news release that are not historical facts are forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statements. Detailed information about factors that may affect the performance of CME Group may be found in its filings with the Securities and Exchange Commission, including our most recent Quarterly Report on Form 10-Q, which is available in the Investor Relations section of the CME Group Web site. Additionally, the proposed transaction is subject to negotiation of the definitive agreement and we cannot assure you that such agreement will be executed. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
Source: CME Group