Chicago Mercantile Exchange : Ask Biography

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The Chicago Mercantile Exchange (CME) (often called "the Chicago Merc," or "the Merc") is an American financial and commodity derivative exchange based in Chicago. The CME was founded in 1898 as the Chicago Butter and Egg Board. Originally, the exchange was a non-profit organization. The exchange demutualized in November 2000, went public in December 2002, and it merged with the Chicago Board of Trade in July 2007 to become a designated contract market of the CME Group Inc. The Chief Executive Officer of CME Group is Craig S. Donohue. On August 18, 2008 shareholders approved a merger with the New York Mercantile Exchange (NYMEX) and COMEX. The Merc, CBOT, NYMEX and COMEX are now markets owned by the CME Group.

CME trades several types of financial instruments: interest rates, equities, currencies, and commodities. It also offers trading in alternative investments such as weather and real estate derivatives, and has the largest options and futures contracts open interest (number of contracts outstanding) of any futures exchange in the world.

CME also pioneered the CME SPAN software, used around the world as the official performance bond (margin) mechanism of 50 registered exchanges, clearing organizations, service bureaus and regulatory agencies throughout the world.

On October 7, 2008, the Chicago Mercantile Exchange (CME) Group announced that it will be teaming up with Citadel LLC to create a transparent electronic trading platform for credit default swaps. The joint venture between CME and Citadel will operate as an independent organization with its own board of directors and management team. The new venture plans to initially provide clearing services for contracts involving credit-default swap indices, which typically have more standardized terms than swap contracts for individual bonds. It is expected to eventually expand its offering to include other derivative indices as well as the multitude of single-name corporate derivatives. Major market participants will be invited to join the platform as founding members, in return for receiving a 30% equity portion of the venture.