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The $2 version released previously was a joke and destined to fail as we
discussed on the List. I was hoping they would just make the $10 contract
electronic once they saw the error of their ways, but this $5 one may have a
chance.
CBOT to Launch New Electronic Dow Contract
Chicago, March 21, 2002 - Continuing to expand creation of new products and
trading opportunities, the Chicago Board of Trade (CBOT®) today announced
the newest addition to its DowSMJonesSM Complex, a CBOT® mini-sized DowSM
contract with a $5 multiplier, to be launched on April 5, 2002 (trading
begins 8:15 p.m. on 4/4/02). To enhance liquidity, the CBOT® plans to use
two electronic market markers for the CBOT® mini-sized DowSMfutures
contracts on its electronic trading platform. The new CBOT® mini-sized
DowSM($5) contract is one-half the size of the original CBOT® DowSMJones
Industrial Average (DJIASM) futures contract. The value of a CBOT®
mini-sized DowSMcontract is its multiplier times the DJIASM index level.
CBOT® Chairman Nickolas J. Neubauer said, "The CBOT® received strong
encouragement from customers to launch a new mini-sized contract and we are
responding. The introduction of the CBOT® mini-sized DowSMcontract with a $5
multiplier complements our existing DowSMEquity and CBOT® Index complexes.
This unique synergy, combined with the trading expertise and liquidity
provided by our DowSMtraders, ensures the best fit for open auction and
screen arbitrage opportunities for our members and retail customers. "In
addition to electronic market makers, a new CBOT® arbitrage program, with
multiple firms participating, is now in place to promote an environment
conducive to arbitrage and spreading between the open auction contracts and
electronic mini-sized contracts." CBOT® DJIASM and mini-sized DowSMfutures
contracts based on the DowSMJones Industrial Average -- the world's most
readily recognized and followed stock index -- provide large and small
investors a way to profit by taking a position based on the performance of
the DJIASM, to diversify and protect their portfolios against adverse price
changes in the stock market, and to preserve investment value. On April 5,
the CBOT® will cancel side-by-side trading for its DJIASM futures and
futures-option contracts. The new trading hours for the CBOT® DowSMJones
complex are as follows: DJIASM futures & futures options - open outcry: 7:20
a.m. -3:15p.m.; electronic: 8:15 p.m. - 7:00 a.m.; CBOT® mini-sized
DowSM($2) and ($5) contracts - electronic: 8:15 p.m. - 4:00 p.m. For more
information on the DJIASM futures contracts and on the DowSMJones Complex,
please visit the CBOT® website at www.cbot.com.
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