Micro CL contract - support the introduction by CME - petition

Discussion in 'Commodity Futures' started by steve2222, Nov 13, 2019.

  1. Help FT71 (broker) convince the CME to introduce a true micro CL (oil) contract at 1/10th the e-mini size on the back of the very successful launch by the CME of the micro US equity index futures contracts.

    The current smaller sized oil contact (QM) is not small enough and it's tick size is not granular enough ($0.025 per tick) ie it needs to be $0.01 per tick to match the CL.

    https://www.change.org/p/cme-group-inc-cme-to-launch-micro-crude-product

    Thanks
     
    SimpleMeLike likes this.
  2. Overnight

    Overnight

    Signed. Micro CL would be a fun one.
     
    SimpleMeLike likes this.
  3. bone

    bone ET Sponsor

    The bid-ask slippage is going to be higher on the micro because the MM hedge will be on the mini, which will be higher than the full CL contract again because of the MM hedge. So sure, you might have a lower initial capital requirement - but is it worth 8 cents slippage per RT?

    Maybe the better option for you would be the USO ETF. If you can consistently grind out a couple hundred bucks per day getting good with USO that would make a transition to CL much more realistic.

    Also, CL intramarket spread trades are margined at a fraction of the outright margin so that's another possibility but they are better as a swing trade than a day trade.

     
    comagnum likes this.
  4. Overnight

    Overnight

    I disagree. The CL many times has larger volume than the NQ, and the MNQ has worked out well with nary a gap in the B/A spread. So logically it would follow that a Micro CL, with same specs as the CL and not that QM crap, would be a hit among both producer/consumers and specerlators (sic) alike.
     
    steve2222 likes this.
  5. Overnight

    Overnight

    Steve, a true 1/10 of CL would be $1 per tick, not 1 penny per tick, heh.
     
    steve2222 likes this.
  6. tiddlywinks

    tiddlywinks

    A very similar increment hierarchy exists with the SP500 products...
    SP -> ES -> MES

    8 cents, 4 per side is a bit exaggerated I think.

    That said, I do think the "danger" of micros is yet to be seen.
    I believe they will increase volatility, partially due to the hedges you mention.
    It will be interesting to see what happens when sustained $50+ fast bars becomes common place instead of one-offs on the micros. Careful what you wish for people.
     
    bone and Edmond like this.
  7. Overnight

    Overnight

    What "danger?"

    The micro currencies and micro gold have been around for what, 10 years? Any danger seen in those yet? The micro equities have been around for 6 months. What "danger" has cropped up with them?

    So what danger will crop up with a micro-CL?
     
    steve2222, SunTrader and Big AAPL like this.
  8. Big AAPL

    Big AAPL

     
  9. Big AAPL

    Big AAPL

    Really...it's a volatile contract no matter it's granularity
     
  10. Overnight

    Overnight

    You know you can edit pervious posts up to an hour after posting them to...clean them up? I see the quoting error you are trying to address. :)
     
    #10     Nov 13, 2019