Indiana Grain Company, LLC

Posted: 03/14/10

By: tomgrisafi

You may have noticed that we at Indiana Grain have been writing about the CME Group a lot lately. But, conversely, you may have also noticed that our friends at CME have been making a lot of headlines.

Two of the world's biggest derivatives exchanges in the US and Europe announced cross-listing agreements with their Asian counterparts in a sign that cross-listing represents an increasingly important part of their strategy to deepen ties with markets in the region.

Two of three deals involved the National Stock Exchange (NSE) of India as the country taps overseas traders to use its rapidly growing derivatives markets. The developments come as Asian exchanges are growing faster than many western rivals, which see them as an opportunity to access new market participants.

The NSE signed an arrangement with CME Group, the largest US futures exchange, under which the Indian exchange's S&P CNX Nifty index, the leading Indian benchmark index for large companies, will be made available to the Chicago operator for the creation and listing of US dollardenominated futures contracts for trading on CME.

CME will make the rights to the S&P 500 and Dow Jones Industrial Average indices available to the Indian exchange for the creation and listing of rupee-denominated futures contracts for trading in India on the NSE.

Ravi Narain, NSE chief executive, said: "We have aspirations to go global . . . This association with CME Group will make . . . products across various Indiarelated asset classes, available to a much larger community of traders and investors. At the same time, investors in India will have access to new exchange traded products."

NSE agreed a similar deal with Singapore Exchange which will soon start offering trading of the Nifty index.

Separately, Eurex, the derivatives exchange owned by Deutsche Börse, said it would in August launch contracts based on the Korea Exchange's Kospi 200 stock-index options.

The moves come the same week as the CME agreed a deal to take a small stake in the Mexican Bolsa.

Source: Financial Times

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