Russell vs S&P Midcap

Discussion in 'Index Futures' started by ZBEAR, Apr 2, 2008.

  1. ZBEAR


    My broker tells me that this contract (June) is the
    last contract month to trade the Russell.....before it migrates over to the ICE.

    As you know the CME is offering the Midcap S&P as an alternative.

    I'm wondering exactly what that is going to mean.

    Better fills on the S&P Midcap ......or worse.....or who knows ?
    Tick size will remain the same.

    Any knowledgeable opinions would be appreciated.

    The Russell is my Fav......hate to see it go.


  2. perhaps consider GLOBEX/COMEX Gold (same tick$$) or NYMEX/Globex Crude Oil (same tick$$$)...or more contracts of ES to equal what you were trading on the ER2...what do you think?...I think the midcap SP will continute to have low volume...
  3. ZBEAR


    Broker tells me the volume is about half of the Russell right now - and increasing......We'll see.
    The exchange is doing a big Promo on it....I got one the other night.

    Been awhile since I traded mini gold....maybe I'll take another look.....thanks.

    Anyone else ?

  4. hprop


    I'd also be interested in a discussion of what's going to happen with the Russel2000 index future after it moves to ICE. I believe the September contract will be the last to trade on CME, and not June.

    The question is if there will be any volume at all on ICE - if they promote it with zero exchange fees for a while they might be successful in at least getting some index arbitrage. But how much "real" orderflow will it have?

    This move could also reduce the volume in the Russell2000 shares, as there'd be less positions to offset.

    I'm really not familiar enough with the Russel2000-shares to offer any qualified insight, but am very keen on listening to others with an educated opinion.

    Myself, I'm doing some profitable ER2-strategies amongst others so I would very much hope it continues to trade as before after September as well.
  5. The S&P Midcap 400 is trading for a long time. According to the CME website they offer the S&P Smallcap 600 though since a few months. The symbol at IB is "SMC" but I can't see it trading yet. Shows no bids/asks for me?!
  6. Yep you are right there has been some confusion about what will replace the ER2 and the S&P 600 is the closer equivalent. What I have witnessed over the years is how quickly vol can grow from a low base just look at the Eurex bund especially when they are electronic traded (as they all are now) But the CME have been lax if you ask me about trying to give this contract a starting boost and it could cost them
  7. EMD (S&P Midcap) currently does 1/5th of the Volume of ER2.

    The daily ranges on EMD are almost as high as ER2.

    But SMC (Small Cap 600) is not a good replacement for ER2 for day traders as it has half the daily tick range of ER2. (The Index value is half, so the range is half also).
    SMC is only good for hedging if ER2 ever goes down, 2 SMC contracts for each ER2 one.

    We should all give ER2 a chance on ICE, but if it gives bad slippage then we need to consider something else.

    If enough Day traders move over to EMD and it can get 100K contracts a day then it will be much more tradeable than it currently is.