so far, the volume traded is virtually zero. H2O F21 open interest volume is at a scarcity level of 9. let's see how it goes for another few months. There are lots of futures with virtually zero volume.
Water futures represent a troubling milestone for financialization There is also a more profound risk to financialization, with water as the ultimate example. Turning water or education or housing into entries on a ledger makes it possible to exchange them for one another, or for anything else, increasing market efficiency. But that flattening can hide much larger truths: for instance, that water scarcity has been exacerbated by decades of corporate pollution, itself driven by the abstractions of the stock market. Or even the simple idea that water, as a universal necessity for human life, should be venerated as precious and managed for the common good, instead of reduced to a ticker symbol that produces fees for the banking elite. https://fortune.com/2020/12/09/money-should-flow-like-water-but-should-water-be-like-money/
They have this naive "if we build them they will come" mentality at the exchanges on these new products and predictably the vast majority of them fall flat on their face. If you don't have market makers, you don't have a market and you really need to ensure you have both a robust supply and demand side as well. But at the very least they should realize they have to line market makers up before they launch a new product like this, why bother to even launch it if you haven't done that?
If you remember the end of the Big Short, maybe you remember Dr. Michael Burry's next big thing. Regards, PTR
UN Warns New Water Futures May Spark Bubble for Vital Resource The United Nations said Wall Street’s new water futures risk an essential public good being treated like gold and oil, leaving the market vulnerable to a speculative bubble. CME Group Inc.’s new contract -- which debuted this week-- could lure interest from hedge funds and banks alongside farmers, factories and utilities looking to lock in prices, said Pedro Arrojo-Agudo, the UN’s special rapporteur on the human rights to safe drinking water and sanitation. That risks a price run-up for a resource that “belongs to everyone” and is a vital tool in combating the Covid-19 pandemic. “The news that water is to be traded on Wall Street futures market shows that the value of water, as a basic human right, is now under threat,” Arrojo-Agudo said in a statement. “It is closely tied to all of our lives and livelihoods, and is an essential component to public health.” The new futures contract is linked to the $1.1 billion spot water market in California, the biggest U.S. agriculture market and world’s fifth-largest economy. Supplies face increasing threats from climate change, rising populations and pollution from mining and farming, the UN said. CME didn’t immediately reply to an email seeking comment. https://www.bloomberg.com/news/arti...r-futures-may-spark-bubble-for-vital-resource Wonder if it will pick up any real volume soon.. still untradeable.
well. let's wait for another 11 months. there are tons of futures with virtually zero volume. look at the various MSCI index futures from Eurex, HKFE, SGX. those exchanges just want to have a very long list of futures in their portfolio regardless of its volume.