CME ends new expiries for sports and awards swaps

CME will stop adding new expiries to its sports- and cultural-event contract swaps on CME Globex from 11 Sept, but contracts already listed will keep trading, clearing and settling until they expire. Once the remaining expiries run off, the exchange said, it will not replace them with new contracts.

In a self-certification filed under Regulation 40.6(a), CME said the change covers sports markets and cultural awards such as the Oscars and the Grammy Awards. The CFTC filing amends the listing schedule so that no additional expiries will be available for trading on Globex.

The live contracts remain subject to CME's trading, surveillance, clearing, disciplinary and dispute-resolution rules. They will stay listed on Globex for competitive, open execution.

CME Clearing will continue to clear the expiries, while the exchange's Market Regulation Department will monitor trading and retain investigatory and enforcement powers. CME also said it will keep publishing daily volume and price information on its website and through quote vendors, and will issue a Globex notice setting out the change.

The filing repeated CME's earlier argument that the contracts are not readily subject to manipulation. For sports events, it cited the complexity of multi-player contests, centralized officiating, league penalties and surveillance of global betting markets. For cultural awards, it pointed to confidential voting, third-party tabulation, chain-of-custody procedures and strict conduct rules.

Existing expiries remain subject to a position-reporting level of 500 contracts and a single-month accountability level of 25,000 contracts, equal to a notional value of $25,000. CME said there were no substantive opposing views to the proposal.