Eurodollar Futures

Discussion in 'Financial Futures' started by matador04, Apr 14, 2009.

  1. The Mini sized Eurodollar Futures have a notional of 500k, 1,250 multiplier, and overnight maintenance margin of 250 (YE on ECBOT).

    The E-mini Eurodollar has notional of 100k, 250 multiplier, and overnight maintenance of *1,100* (EED on Globex).

    Why the difference in margin requirements and is the Globex MUCH more liquid??

  2. Mini sized Eurodollar futures do not trade, and infact were delisted several years ago, I believe
  3. Stosh


    Looks like GE on Globex is the one that trades round the clock and has most volume. I've never traded it....but am thinking about giving it a whirl. Stosh

    Dear ET'ers,

    This is addressed to any INTEREST RATE FUTURE traders.

    If you are a troll, weiner, permabull or otherwise mentally handicapped, please do not reply. Thanks.

    I'm successful in other futures markets & have been watching the June GE (Globex Eurodollar) for some time.

    Theoretically, the highest it could go is 100, so downside is limited for those shorting.

    My question is: Do you believe it's possible that the Fed could squeeze it up to near 99.80 - 99.99, or is it more likely that we're nearing a major 'resistance'?

    It's an enormous market so I'm not uncomfortable talking openly about trading it...

    I'm thinking of taking short positions, esp. now that it seems overbought.

    What are interest rate risks here? In other words...if things started going to $hit...PANIC PANIC...etc., do you think rates are more likely to RISE?

    I think so because as risk & doubt increase, lenders may demand more for their precious capital.

    Anyhow, if anyone's an active IR trader I'd love to hear your thoughts. Eurodollar is a market I've mostly ignored during my career but it's interesting how it's approaching a level beyond which it cannot advance (0% interest rates; or 100.000 on GE).

    THANKS, in advance.

    --Harold :)
  5. "Theoretically, the highest it could go is 100, so downside is limited for those shorting."

    Bad assumption. You seem to have missed the announcement from the CME allowing Eurodollar option strike prices over par.


    CME Group has modified its options on Eurodollar futures to allow traders to hedge against the prospect of negative interest rates.
    The change took effect on January 25 to allow strike prices above par, which correspond to an implied yield below 0%.

    The value of the Eurodollar contract at expiration is determined by the three month dollar London interbank offered rate (Libor), and its implied yield represents the market’s forecast. "
  6. 1) It can go above "par". It would be as if depositors are paying a "storage fee" to banks.
    2) Eurodollars may be too slow-moving for you. You may be better off trading bonds or notes instead.
    3) Eurodollars can behave more predictably with respect to Fed Policy compared to longer-duration instruments.
    4) It's a huge market. Nobody will care what your "strategy" is.
    5) If you're obsessed with the market never going above "100", you ought to be even more excited about short-selling Fed Funds futures.
    6) With eurodollars, focus on the "active" months, not the front month, serial months nor mega-deferreds. :cool:
  7. John47


    Last trade GEm9 was 9929.5....I'm 9929.5 bid...I'll buy if you're selling :).