Chicago (Reuters) Dec. 14 The Chicago Mercantile Exchange (CME;NASDAQ) announced today that futures on the Dow Jones Industrial index will begin trading in quarter point increments effective this Monday, Dec 22nd. Previously a minimum fluctuation on the electronically traded contract (symbol YM) was a full Dow point. CME Group spokesperson Kelly Crier said the Exchange decided to make the surprising change after talks with the SEC, Treasury and the Federal Reserve. Consensus among key government officials is, "we're beginning an era of decreased volatility. The Fed has made clear they'll backstop any hard single session corrections and our models show an average Dow range of 18-45 points to be the probable scenario moving forward." If the Dow futures move is successful, the immensely popular e-mini Standard and Poor's 500 will begin trading in .10 increments in spring of 2010.
1) Oh no! Smaller ticks are "good" for customers and "bad" for professionals. 2) Contract alterations tend to be bearish. We'll see.
Funny! Consensus among key government officials is, "we're beginning an era of decreased volatility. The Fed has made clear they'll backstop any hard single session corrections and our models show an average Dow range of 18-45 points to be the probable scenario moving forward." Hilarious! If the Dow futures move is successful, the immensely popular e-mini Standard and Poor's 500 will begin trading in .10 increments in spring of 2010.
People said smart people worked at Wall Street, but why did the Wall Street people do stupid things, again and again? If volatility has decreased, they should do the opposite=make the increment bigger, not smaller. YM has already looked like a dead index futures intrument with its oftentimes 2-point spread. Where the hell do they find the liquidity to support the quarter-point increment??? I think they should make the YM increment at 3 points or 5 points, just to cover their embarrassingly large spread of 2 points. Quarter-point? Give me a break. You can't even make the 1-point increment. Fucking idiots! With this bunch of idiots managing YM index futures, no wonder traders are leaving YM.
Nothing on the CME site. Very doubtful. http://search.cmegroup.com/search?q...group&num=20&proxystylesheet=cmegroup&x=0&y=0
seems a bit small for YM if true, but the ES will be perfect now at .10 yeeehaw! I think the YM is fine anyways they should leave it alone.