CHICAGO, Aug. 23, 2021 /PRNewswire/ -- Cboe Global
Markets, Inc. (Cboe: CBOE), a leading provider of global market
infrastructure and tradable products, today announced plans to
launch futures on the AMERIBOR® (American Interbank Offered Rate)
Term-30 interest rate benchmark. The new futures are expected to be
available for trading on Cboe Futures Exchange, LLC (CFE) on
business date Monday, September 13,
2021, subject to regulatory review.
The AMERIBOR Term-30 benchmark, disseminated by the American
Financial Exchange, LLC (AFX™), is designed for financial
institutions in need of forward-looking short-term interest rates
as the planned cessation of LIBOR approaches. The benchmark is
designed to capture wholesale funding costs for American financial
institutions over a thirty-day period at a specific moment in
time.
AMERIBOR Term-30 futures (AMT1 futures) will be cash-settled and
are designed to reflect market expectations of the level of the
AMERIBOR Term-30 benchmark rate, which is used in the determination
of the final settlement value of the applicable AMT1 futures
contract. Cboe Futures Exchange plans to initially offer futures on
the 30-day term rate, followed later this year by futures on the
AMERIBOR Term-90 benchmark rate, subject to regulatory review.
The AMERIBOR Term-30 benchmark has a credit sensitive element
and represents a forward-looking interest rate, making it
comparable to One-Month LIBOR, but derived in a transparent and
representative fashion and based upon actual financing
transactions. As such, the benchmark is expected to serve as a
"plug-in and play" replacement for One-Month LIBOR.
"We are pleased to further collaborate with AFX and provide
market participants with the tools they need to help ease their
transition away from LIBOR," said Michael
Mollet, Vice President, Futures at Cboe Global Markets. "We
expect market participants, especially banks who consider the
AMERIBOR index representative of their true cost of funding, will
find the new futures to be particularly well-suited to manage
interest-rate risk on loans or execute interest-rate trading
strategies."
Banks and other financial institutions may use AMT1 futures in
connection with hedging their variable short-term funding costs and
interest rate risk. Proprietary trading firms may use AMT1 futures
in connection with hedging their exposure to other interest rate
derivatives or to conduct trading strategies involving AMT1 futures
on the one hand and other interest rate derivatives on the other
hand, such as swaps based on the AMERIBOR Term-30.
"AMERIBOR Term-30 is the result of extensive research, testing,
analysis and consensus-building to provide the marketplace with an
innovative alternative to One-Month LIBOR," said Dr. Richard Sandor, Chairman and CEO of the American
Financial Exchange. "We are excited to further expand our suite of
offerings with Cboe to include futures on the AMERIBOR Term-30
benchmark and to deliver more choices so that market
participants can use the products that best suit their trading
needs."
Currently, AFX membership across the U.S. includes 181 banks and
more than 1,000 correspondents, with combined assets of over
$5.3 trillion. There are 45 non-bank
members, including insurance companies, broker-dealers,
private equity firms, hedge funds, futures commission merchants,
and asset managers.
Cboe Futures Exchange now offers a range of futures products on
the AMERIBOR interest rate benchmark, including three-month,
one-month and seven-day contracts. To learn more about the new AMT1
futures and the full suite of AMERIBOR futures products, visit
Cboe's website.
About Cboe Global Markets, Inc.
Cboe Global Markets (Cboe: CBOE), a leading provider of market
infrastructure and tradable products, delivers cutting-edge
trading, clearing and investment solutions to market participants
around the world. The company is committed to operating a trusted,
inclusive global marketplace, providing leading products,
technology and data solutions that enable participants to define a
sustainable financial future. Cboe provides trading solutions and
products in multiple asset classes, including equities, derivatives
and FX, across North America,
Europe and Asia Pacific. To learn more, visit
www.cboe.com.
Media
Contacts
|
Analyst
Contact
|
Angela
Tu
|
Tim
Cave
|
Kenneth Hill,
CFA
|
+1-646-856-8734
|
+44 (0)
7593-506-719
|
+1-312-786-7559
|
atu@cboe.com
|
tcave@cboe.com
|
khill@cboe.com
|
CBOE-C
CBOE-EF
Cboe®, Cboe Volatility Index®, CFE®, and VIX® are registered
trademarks and Cboe Global MarketsSM and Cboe Futures
ExchangeSM is a service mark of Cboe Exchange, Inc.
AFX™, AMERIBOR® are registered trademarks of American
Financial Exchange, LLC, and have been licensed for use by
Cboe Exchange, Inc. All other trademarks and service marks
are the property of their respective owners.
Any third-party products that have the AMERIBOR® Term-30
benchmark as their underlying interest are not sponsored, endorsed,
sold or promoted by American Financial Exchange or Cboe and neither
American Financial Exchange nor Cboe make any representations or
recommendations concerning the advisability of investing in
products that have AMERIBOR® indexes as their underlying
interests. All other trademarks and service marks are the
property of their respective owners.
Futures trading is not suitable for all investors and
involves the risk of loss. That risk of loss can be substantial and
can exceed the amount of money deposited for a futures position.
You should, therefore, carefully consider whether futures trading
is suitable for you in light of your circumstances and financial
resources. You should put at risk only funds that you can afford to
lose without affecting your lifestyle. For additional information
regarding futures trading risks, see the Risk Disclosure Statement
in Appendix A to CFTC Regulation 1.55(c).
Cboe Global Markets, Inc. and its affiliates do not recommend
or make any representation as to possible benefits from any
securities, futures or investments, or third-party products or
services. Investors should undertake their own due diligence
regarding their securities, futures and investment practices. This
press release speaks only as of this date. Cboe Global Markets,
Inc. disclaims any duty to update the information herein.
Nothing in this announcement should be considered a solicitation to
buy or an offer to sell any securities or futures in any
jurisdiction where the offer or solicitation would be unlawful
under the laws of such jurisdiction. Nothing contained in this
communication constitutes tax, legal or investment advice.
Investors must consult their tax adviser or legal counsel for
advice and information concerning their particular
situation.
Cboe Global Markets, Inc. and its
affiliates, to the maximum extent permitted by applicable
law, make no warranty, expressed
or implied, including, without
limitation, any warranties as of
merchantability, fitness for a particular
purpose, accuracy, completeness or
timeliness, the results to be
obtained by recipients of the
products and services described herein, or
as to the ability of the AMERIBOR indexes to track the
performance of its strategy, and shall not in any way be liable for
any inaccuracies or errors. Cboe Global Markets, Inc. and its
affiliates have not calculated, composed or determined the
constituents or weightings of the securities that comprise the
third-party indices referenced in this press release and shall not
in any way be liable for any inaccuracies or errors in any of the
indices referenced in this press release.
Cautionary Statements Regarding Forward-Looking
Information
This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 that involve a number of
risks and uncertainties. You can identify these statements by
forward-looking words such as "may," "might," "should," "expect,"
"plan," "anticipate," "believe," "estimate," "predict," "potential"
or "continue," and the negative of these terms and other comparable
terminology. All statements that reflect our expectations,
assumptions or projections about the future other than statements
of historical fact are forward-looking statements. These
forward-looking statements, which are subject to known and unknown
risks, uncertainties and assumptions about us, may include
projections of our future financial performance based on our growth
strategies and anticipated trends in our business. These statements
are only predictions based on our current expectations and
projections about future events. There are important factors that
could cause our actual results, level of activity, performance or
achievements to differ materially from those expressed or implied
by the forward-looking statements.
We operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time to time,
and it is not possible to predict all risks and uncertainties, nor
can we assess the impact of all factors on our business or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements.
Some factors that could cause actual results to differ
include: the impact of the novel coronavirus ("COVID-19") pandemic,
including changes to trading behavior broadly in the market; the
loss of our right to exclusively list and trade certain index
options and futures products; economic, political and market
conditions; compliance with legal and regulatory obligations; price
competition and consolidation in our industry; decreases in trading
or clearing volumes, market data fees or a shift in the mix of
products traded on our exchanges; legislative or regulatory
changes; our ability to protect our systems and communication
networks from security risks, cybersecurity risks, insider threats
and unauthorized disclosure of confidential information; increasing
competition by foreign and domestic entities; our dependence on and
exposure to risk from third parties; fluctuations to currency
exchange rates; our index providers' ability to maintain the
quality and integrity of their indices and to perform under our
agreements; our ability to operate our business without violating
the intellectual property rights of others and the costs associated
with protecting our intellectual property rights; our ability to
attract and retain skilled management and other personnel; our
ability to minimize the risks, including our credit and default
risks, associated with operating a European clearinghouse; our
ability to accommodate trading and clearing volume and transaction
traffic, including significant increases, without failure or
degradation of performance of our systems; misconduct by those who
use our markets or our products or for whom we clear transactions;
challenges to our use of open source software code; our ability to
meet our compliance obligations, including managing potential
conflicts between our regulatory responsibilities and our
for-profit status; our ability to maintain BIDS Trading as an
independently managed and operated trading venue, separate from and
not integrated with our registered national securities exchanges;
damage to our reputation; the ability of our compliance and risk
management methods to effectively monitor and manage our risks; our
ability to manage our growth and strategic acquisitions or
alliances effectively; restrictions imposed by our debt obligations
and our ability to make payments on or refinance our debt
obligations; our ability to maintain an investment grade credit
rating; impairment of our goodwill, long-lived assets, investments
or intangible assets; and the accuracy of our estimates and
expectations. More detailed information about factors that may
affect our actual results to differ may be found in our filings
with the SEC, including in our Annual Report on Form 10-K for the
year ended December 31, 2020 and
other filings made from time to time with the SEC.
We do not undertake, and we expressly disclaim, any duty to
update any forward-looking statement whether as a result of new
information, future events or otherwise, except as required by law.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date
hereof.
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SOURCE Cboe Global Markets, Inc.