Great success: CME’s Micro U.S. Treasury futures in high demand

Rick Steves

“Amid shifting interest rate expectations, Micro U.S. Treasury futures offer easier access to key 10- and 30-year benchmarks, complementing our broad risk management suite of U.S. Treasury offerings.”

CME Group

CME Group has announced that its Micro U.S. Treasury futures product has surpassed 100,000 contracts traded since their introduction on March 25.

Quickly overcoming the 100,000 contract milestone highlights the robust demand and successful integration of these futures into global trading strategies.

Micro U.S. Treasury futures offer easier access to key 10- and 30-year benchmarks

The product is particularly valuable in providing easier access to essential 10- and 30-year U.S. Treasury benchmarks, especially amidst the volatile interest rate environment.

CME Group achieved a record average daily volume of 7.8 million contracts in U.S. Treasury futures and options, which reflects a 12% increase year-over-year.

The newly introduced Micro U.S. Treasury futures are cash-settled, each being one-tenth the size of the standard Ultra 10-Year U.S. Treasury Note futures and Ultra U.S. Treasury Bond futures.

They also offer the advantage of automatic margin offsets with other CME Group Interest Rate futures and adhere to CBOT’s rules.

Agha Mirza, CME Group Global Head of Interest Rates and OTC Products, said: “As the world’s most liquid market for U.S. Treasury futures, CME Group is pleased that so many of our global clients are incorporating smaller-sized Micro U.S. Treasury futures into their trading strategies. Amid shifting interest rate expectations, Micro U.S. Treasury futures offer easier access to key 10- and 30-year benchmarks, complementing our broad risk management suite of U.S. Treasury offerings.”

CME Group teamed up with DTCC for Treasury cross-margining

Earlier this year, CME Group and DTCC went live with their enhanced Treasury cross-margining arrangement, after being approved by the SEC and CFTC in 2023.

The importance of efficient cross-margining opportunities across Treasury securities and futures activity is even more significant based on the increase in Treasury activity that will be required to be centrally cleared.

The new arrangement allows for capital efficiencies for clearing members involved in both U.S. Treasury securities and CME Group Interest Rate futures. The service facilitates cross-margining for a broader range of products, including CME Group’s SOFR futures, Ultra 10-Year U.S. Treasury Note futures, and Ultra U.S. Treasury Bond futures, along with FICC-cleared U.S. Treasury notes and bonds. Repo transactions with Treasury collateral having over a year to maturity are also included.

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