Order Providing Exemptive Relief To Facilitate Listing of Cash-Settled Futures on Individual Equity Securities
Key claim: The CFTC is granting exemptive relief from its opening-price settlement requirement so CME can list cash-settled futures on individual equity securities.
Abstract
(Rule · Commodity Futures Trading Commission) The Commodity Futures Trading Commission (“Commission” or “CFTC”) is issuing an order pursuant to the Commodity Exchange Act (“CEA”) that provides exemptive relief from the Commission’s opening price settlement requirement for security futures products in connection with Chicago Mercantile Exchange Inc.'s (“CME”) plans to list cash-settled futures on individual equity securities for trading pursuant to its registration as a designated contract market and notice registration as a national securities exchange.
Why this matters
Cash-settled single-stock futures have historically been constrained by CFTC settlement-price rules designed for physically-settled security futures, limiting product innovation on U.S. designated contract markets. By granting exemptive relief from the opening-price settlement requirement, the CFTC clears a path for CME to list a new class of equity derivatives, expanding hedging and speculation tools for investors and intensifying competition with OTC and offshore venues.