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CME Group has announced the upcoming launch of its new credit futures, scheduled to begin trading on Monday, June 17, 2024, subject to regulatory approval.
The new CME Group credit futures will be the first futures contracts to facilitate duration risk management through an intercommodity spread with U.S. Treasury futures. Additionally, for the first time, investors will be able to gain exposure to and manage credit component risk through futures on Bloomberg's duration-hedged index. The contracts will be listed alongside the company's leading U.S. Treasury complex.
Agha Mirza, CME Group Global Head of Rates and OTC Products, stated, "Since announcing our expansion into credit futures earlier this year, we have received very positive feedback from market participants with exposure to credit, interest rates, equities and other assets. Designed for efficiency, our credit futures will support spread trading with automatic margin offsets against our Interest Rate and Equity Index futures."
The new futures contracts will be based on the Bloomberg U.S. Corporate Index, which tracks the performance of investment grade corporate bonds, and the Bloomberg U.S. High Yield Very Liquid Index, designed to measure a liquid, diversified component of the high yield corporate bond market.
Umesh Gajria, Global Head of Index Linked Products at Bloomberg Index Services Limited, commented, "CME Group's upcoming launch of futures based on the Bloomberg U.S. Corporate Bond Indices supports the continued advancement of fixed income markets. These credit futures can provide a capital efficient vehicle for investors to manage their exposures and risks to their bond portfolios through the derivatives market."
U.S. Corporate Bond Index futures will be available to trade on CME Globex and eligible for submission to clearing via CME ClearPort. The contracts will be listed with, and subject to, the rules of CME.
