CME Group Enters European Wheat Futures and Options Market in September | Finance Magnates (2024)

FAQs

Are CME options cash settled? ›

At the expiration of the futures contract, it is cash-settled against a reference price for the commodity published at that time. option, the Exchange has arrangements to automatically exercise options with remaining intrinsic value on your behalf.

While there are several different wheat futures contracts, Chicago Soft Red Winter (SRW) wheat is the most traded wheat contract in the U.S. Chicago SRW is the global industry standard wheat benchmark in the world.

Flour production, supply and disappearance, and price data are presented by calendar years. The international trade year for wheat is July 1–June 30. July 1 approximates the wheat harvest in many Northern Hemisphere countries.

The choice between futures and options depends on your investment goals and risk tolerance – Both instruments can be used for hedging, but options offer more flexibility and limited risk. Futures offer higher potential profits but also higher risk, while options provide limited profit potential with capped losses.

The CME contracts are based on the Bitcoin Reference Rate (BRR) index, which aggregates bitcoin trading activity across four bitcoin exchanges - itBit, Kraken, BitStamp, and GDAX - between 3pm and 4pm GMT. On the other hand, CBOE will price contracts with a single auction at 4 pm on the final settlement date.

According to the data, much of this drop-off can be attributed to declining activity on Canadian National, which has been bracing for a strike. CN grain carloads are down 36% from this time last year. Struggling U.S. export demand is also hitting shipments, particularly for soybeans and wheat.

For wheat, one bushel equals 60 pounds of wheat or approximately one million wheat kernels. A common semi-truck grain hopper can hold approximately 1,000 bushels of wheat – or 60,000 pounds of wheat in a single load.

Spring wheat is sown in the spring and is harvested in the fall. Winter wheat is sown in the fall, lives through the winter, and is then harvested in the summer. Harder winter wheat usually contains a higher protein content than spring wheat and is suitable for making pasta and bread.

What is the best spring wheat for flour? ›

Hard red spring wheat is often used as a healthy substitute for traditional all-purpose bleached or unbleached flour commonly found in grocery stores.

North Dakota is ranked as the top producer of wheat in the USA. The states possess great climatic conditions and diversity in crop production. It is one of the leading producers of sunflower and honey in America. North Dakota is rich in the plantations of carinata, fav beans, and hops, as well.

U.S. imports of wheat grain, mostly from Canada, have grown from less than 0.1 million metric tons in the 1970s to an average of 2.4 million metric tons over the last 10 complete marketing years (2013/14–2022/23).

Cash-settled options are trades that pay out in cash at expiration, rather than delivering the underlying asset or security. Cash-settled options typically include index options and binary/digital options. This kind of settlement often simplifies the mechanics of the trade when options are exercised or at expiration.

Although physical delivery is an important mechanism for certain energy, metals and agriculture products, only a small percent of all commodities futures contracts are physically delivered. In most cases, delivery will take place in the form of cash settlement.

Examples of cash settled index options that you can trade are S&P 500 Index (SPX), Nasdaq 100 Index (NDX), Russell 2000 Index (RUT), Volatility Index (VIX), Dow Jones Index (DJX), S&P 100 Index (OEX), and the S&P 500 Mini Index (XSP).

CME Group staff determines the daily settlements in the E-Mini NASDAQ 100 (NQ) futures based on trading activity on CME Globex between 15:14:30 – 15:15:00 Central Time (CT), the settlement period. The lead month is the anchor leg for settlements and is the contract expected to be the most active.