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THE OFFICIAL NEWSPAPER OF TRADETECH FX 2023
Figure 1 : CME FX Futures Average Daily Volume vs OTC FX Spot Venues ( Primary Markets & Major ECNs ), Full Year 2022
A closer look at MXN Futures – a growing market at CME Group
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US $ 90bn
US $ 81bn
US $ 72bn
US $ 63bn
US $ 54bn
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In the first half of 2023 , an average of $ 1.68B of MXN futures traded every day – an increase of 24 % YoY |
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US $ 45bn
US $ 36bn
US $ 27bn
US $ 18bn
US $ 9bn
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March 2023 was an all-time record volume month , with $ 2.84B trading daily |
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US $ 0bn
CME FX Futures
Venue 1 *
Venue 2
Venue 3
Venue 4
Source : CME Group , publicly reported spot FX data on respective venue websites * Estimated spot FX volume , derived from publicly reported data
Venue 5 *
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Venue 6 |
Venue 7 |
Over 4,700 unique users across 80 countries traded CME Group MXN futures in 2022 |
US $ 40bn
Figure 2 : Exchange Traded EURUSD Futures Average Daily Volume , 2022
Figure 3 : Percentage of Buy-side Volume Traded Passively on CME FX CLOBs , 2022
US $ 30bn
FX Futures 63.1 %
US $ 20bn
US $ 10bn
FX Options 70.4 %
Source : CME Group
US $ 0bn CME
Source : Futures Industry Association ( FIA )
All Other Exchanges Combined
( CLOB ). Pricing on the CLOB is firm , anonymous , credit agnostic and all-to-all , with a hugely diverse ecosystem of users .
This not only means there are zero reject rates , but also enables all participants to be liquidity providers and to trade passively within the orderbook – reducing transaction costs by avoiding paying away the bid / offer spread . For example , in 2022 , 63.1 % of hedge fund and asset manager volume was traded passively in FX futures , while for options the proportion was 70.4 %.
While the CLOB is the central venue for futures liquidity , some customers want to trade risk-transfer OTC-style via disclosed bilateral negotiations with chosen liquidity providers . This trading style can be particularly important for larger sized trades and for more esoteric pairs that aren ’ t as actively quoted in the order book , where liquidity providers can lean on OTC liquidity .
During 2022 , there was a sizeable upswing in customers trading CME FX products via these blocks ( large risk transfer trades ) and EFRPs ( OTC vs futures spreads ), with year-on-year growth of 196 % in 2022 . More than 20 liquidity providers now support these trade types at CME FX , including the majority of top-tier global banks as well as non-bank market making specialists .
“ Many customers have long recognised the unique liquidity and clear benefits of using CME FX futures and options as a complement to their OTC activity ,” said Paul Houston , global head of FX products at CME Group . “ However , an increasing number of new participants , particularly from the hedge fund and asset manager community , are looking to access futures liquidity to solve margin and capital challenges .” To find out more on how and why traders are using CME FX products please contact FXteam @ cmegroup . com 1 . www . bis . org / publ / work1094 . pdf
Exchange traded derivatives and cleared over-thecounter ( OTC ) derivatives are not suitable for all investors and involve the risk of loss . Exchange traded and OTC derivatives are leveraged instruments and because only a percentage of a contract ’ s value is required to trade , it is possible to lose more than the amount of money initially deposited . In France , each of CME , CBOT , NYMEX and COMEX have been recognized by the French Minister of Economy under Article D . 423-1 of the French Monetary and Financial Code . CME Group ’ s full disclaimer : https :// www . cmegroup . com / disclaimer . html .
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