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CME - All You Need to Know about Chicago Mercantile Exchange

Also known as CME or the Chicago Merc, the Chicago Mercantile Exchange is a regulated platform to trade futures and options. What’s more, it is the world’s biggest exchange of its kind.


Investors can select from various futures categories ranging from the agricultural sector, natural resources, and precious metals to market indices, Forex trading, meteorology, and even housing.

CME provides a selection of industries for investors of any level to invest in. However, amateur market participants are not familiar with this particular exchange.

In this article, we will explain the CME definition, the way it works, available products, and simple ways to trade them.

What Is Chicago Mercantile Exchange (CME)?

As you already know, it is the biggest futures exchange not only in America but also in the rest of the world. Moreover, it is one of the longest-running platforms.

Initially founded as a non-profit organization back in 1898, it appeared to be the pioneer among all US-based financial exchanges. CME was the first to demutualize and turn into a business owned by stakeholders.

We have already mentioned that Merc is a regulated exchange. Located in Chicago, CME made a name for itself as the best place to trade unconventional commodities. Today, they include BTC futures, meteorological derivatives, and some other extraordinary assets. Originally, corn and wheat were traded here.

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In 1970, the exchange added financial futures to broaden the list of available futures. Later, investors could also invest in rare metals, Treasury bonds, and a selection of other instruments that have become very popular over time.

In 2007, CME Group was introduced to become the biggest financial exchange administration in the world. Today, it is also involved in the operation of some other huge exchanges located in different cities across the world.

What Are the Main CME Trading Platforms?

Trading at CME is quite different from investing with an online Forex broker. You cannot just select a service provider, open an account and buy or sell futures. The Merc comes with self-hosted trading platforms.

Investors have two major options to operate within the exchange:

  1. The first one is to use the CME Globex Trading System – a digital platform that accounts for 90% of all electronic transactions.
  2. The second option is to open an outcry. It is a traditional trading approach that involves a traders’ floor located in a trading pit. The process is much similar to the one we have seen in numerous Wall Street movies with mad brokers calling out orders. All traders wear jackets of different colors to highlight the organization they represent. What’s more, experienced traders still use specific hand gestures that were developed and introduced back in 1970.

Times are changing. The trading industry keeps going online making exchanges and companies turn to a digitalized business model. The same happens to the Merc. Today, its CME Globex Trading System is the core of the Chicago Mercantile Exchange. It lets users trade 24/7 making it possible to complete trades either from the kiosk or home. The system is 100% electronic.

Instruments to Trade at CME

With the exchange development, more and more different products and instruments were added. Today, market players can select from a variety of assets. They include:

  • Agricultural commodities;
  • Interest rate products and Forex trading;
  • Cryptocurrency and precious metals;
  • Energy equity indexes, weather derivatives, and more.

As one of the world’s biggest futures exchanges in the world CME is 100% legit and safe to trade at. What’s more, it is a regulated platform in addition to a strong reputation, years of operation in the market, and millions of clients across the globe.

The only downside is that crypto traders are not able to buy and sell coins directly. The good news is that they can still trade Bitcoin futures. CME generates a gap once the BTC price has gone below or above the preceding day’s closing price. These gaps take place because of premises that the exchange markets are shut over at weekends. However, you still have a chance to trade Bitcoin and other leading cryptocurrencies with the best online broker round-the-clock with no limitations.

How to Trade Bitcoin Futures?

While CME specializes in trading futures, market players can buy and sell BTC futures at MCE. They introduce futures contracts that are cash-settled in USD. Contracts are based on the CME CF Bitcoin Reference Rate (BRR). The rate is used to establish the daily BTC price in the US dollar.

To trade Bitcoin futures at CME, you need to be ready to pay a 37% maintenance margin, while hedgers are obliged to put 100% of the maintenance margin as a hedge. As for speculators, their maintenance margin is even bigger (110%). New traders do not have a chance to access margin offsets.

So, if you are an individual investor, you’d better choose an online broker with better trading conditions and a wider option of instruments to trade 24/7 with no price gaps. MTrading is a leading trading service provider with exclusive offers and the industry’s best trading conditions. Choose from a variety of assets and start risk-free trading right at once.

This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.