CME to Offer Small Investors Foreign-Exchange Futures

By Whitney Kisling

Feb. 18 (Bloomberg) -- CME Group Inc., the world’s largest futures market, will offer new foreign-exchange futures contracts one-tenth the size of existing contracts to help retail investors access currency markets. access currency markets.

The Forex E-Micros, as the contracts are called, will be traded through CME’s Globex electronic network and will follow the same guidelines as larger contracts, while prices will be quoted in interbank or over-the-counter terms, Chicago-based CME said today in a statement released by PR Newswire. Interbank price quotations make it easier for customers to add the smaller contracts to their investment portfolios, CME said.

CME plans to offer the contracts beginning this quarter.

“Active individual traders looking to participate in the global FX market, or small businesses seeking a cost-effective hedging tool for their FX risk, can choose Forex E-Micro futures as a versatile and accessible new resource to manage their exposure,” Derek Sammann, managing director of foreign exchange products at CME, said in the statement.

Foreign-exchange trading worldwide rose 65 percent in the three years to April 2007 to a record $3.2 trillion a day, the Bank for International Settlements said a year ago.

The six contracts that CME will offer include pairings of the U.S. dollar with the euro, Great Britain pound, Australian dollar, Japanese yen, Swiss franc and Canadian dollar. The Canadian dollar, franc and yen contracts are $10,000 each, while the others are 12,500 euros ($15,696), 6,250 pounds ($8,895) and A$10,000 ($6,395).

The euro has fallen 10 percent against the U.S. dollar so far this year, while the Japanese yen has fallen 3.4 percent.

CME Group operates the Chicago Mercantile Exchange, the Chicago Board of Trade and the New York Mercantile Exchange.

To contact the reporter on this story: Whitney Kisling in New York at wkisling@bloomberg.net