CME Group to enhance Natural Gas trading with micro Henry Hub futures and options

Rick Steves

“Our new Micro Henry Hub futures and options contracts will provide global energy traders with additional flexibility to manage their natural gas exposure with precision.”

natural gas supply

CME Group is set to introduce Micro Henry Hub futures and options, further enriching its array of financial products.

These micro contracts, scheduled to debut on November 6th pending regulatory reviews, are designed to offer enhanced flexibility to global energy traders in managing their natural gas exposure with precision.

The new contracts will be just one-tenth the size of CME Group’s flagship Henry Hub futures and options, providing a more accessible entry point for investors.

Manage natural gas exposure with precision

Peter Keavey, Global Head of Energy and Environmental Products at CME Group, said: “Our new Micro Henry Hub futures and options contracts will provide global energy traders with additional flexibility to manage their natural gas exposure with precision.” He highlighted the timeliness of this launch, particularly as the Henry Hub’s importance as a global benchmark continues to grow.

The introduction of Micro Henry Hub futures and options aligns with CME Group’s commitment to delivering cost-effective and accessible trading solutions. These smaller-sized contracts offer clients a more flexible and cost-effective way to engage in benchmark energy futures trading.

Steve Sanders, EVP of Marketing and Product Development at Interactive Brokers, commented: “We are pleased to offer these products alongside other micro futures and options contracts, which continue to be a popular way for our active trader clients to manage their exposure with less upfront commitment.”

Henry Hub futures ADV rose by 14% in 2022

CME Group has witnessed consistent growth in trading activity related to the full-sized Henry Hub futures contract. The average daily volume in this contract has risen by 14% compared to the previous year. Furthermore, trading volume originating outside the United States has grown by 3% this year, accounting for 21% of total volume. Average open interest has also experienced substantial growth, increasing by 16% compared to the previous year.

CME Group continues to maintain its position as the most liquid and efficient marketplace for trading natural gas options. Henry Hub options have seen a remarkable surge, with average daily volume up by 29% from the previous year. Impressively, 55% of this year’s volume has occurred on-screen, marking a 10% increase from the previous year. Average open interest in Henry Hub options has also risen by 12% compared to the previous year.

Micro Henry Hub futures and options will be listed by and subject to the rules of the New York Mercantile Exchange (NYMEX), further enhancing their credibility and reliability.

The upcoming launch of Micro Henry Hub futures and options by CME Group underscores its commitment to providing innovative and accessible financial products to the global trading community. As the financial landscape continues to evolve, these smaller contracts will empower traders to navigate the energy markets with greater precision, reinforcing CME Group’s position as a leader in derivatives trading.

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