CHICAGO, Dec. 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-90 interest rate benchmark. The new futures are expected to
begin trading on Cboe Futures Exchange, LLC (CFE) on business date
Monday, January 24, 2022.
AMERIBOR, disseminated by the American Financial Exchange, LLC
(AFX), is a transparent, transactions-based interest rate benchmark
that represents market-based borrowing costs. The AMERIBOR Term-90
benchmark is specifically designed to capture wholesale funding
costs for American financial institutions over a ninety-day period
at a specific moment in time.
The planned AMERIBOR Term-90 futures (AMT3 futures) further
expands Cboe's suite of AMERIBOR futures products and follows its
recent launch of futures on the AMERIBOR Term-30 benchmark,
the thirty-day term rate. As the planned cessation of LIBOR
approaches, these futures aim to provide an alternative for
market participants to hedge their interest rate risks on loans, or
execute interest-rate trading strategies.
"As client demand for credit-sensitive instruments continues to
grow, we are pleased to offer AMERIBOR Term-90 futures and provide
additional tools to help market participants manage their
transition from LIBOR," said Michael
Mollet, Vice President, Head of Futures at Cboe Global
Markets. "We expect these futures to provide market participants
with access to a more complete suite of AMERIBOR futures to manage
their interest rate exposures going forward."
The AMERIBOR Term-90 benchmark has a credit sensitive element
and represents a forward-looking interest rate, making it
comparable to Three-Month LIBOR, but derived in a transparent and
representative fashion and based upon actual financing
transactions.
"The AMERIBOR Term-30 and AMERIBOR Term-90 interest rate
benchmarks are designed to be 'plug-in and play' replacements for
one-month and three-month LIBOR, fostering an easy adoption for
end-users," said Dr. Richard Sandor,
Chairman and CEO of the American Financial Exchange. "We expect
these rates to fit seamlessly within existing bank models and offer
market participants a forward term structure."
Banks and other financial institutions may use AMT3 futures to
hedge their variable short-term funding costs and interest rate
risk. Proprietary trading firms may use AMT3 futures to hedge their
exposure to other interest rate derivatives, or conduct trading
strategies involving AMT3 futures on the one hand and other
interest rate derivatives on the other hand, such as swaps based on
the AMERIBOR Term-90 and derivatives based on SOFR and LIBOR.
Market participants with exposure to unsecured borrowing costs or
borrowing costs better represented by a forward-looking rate may
also utilize AMT3 futures to hedge their exposures.
Currently, AFX membership across the U.S. includes 184 banks and
more than 1,100 correspondents, with combined assets of over
$5.4 trillion. There are 45 non-bank
members, including insurance companies, broker-dealers,
private equity firms, hedge funds, futures commission merchants,
and asset managers.
AMT3 futures are Cboe's fifth AMERIBOR-based contract and will
be cash-settled and designed to reflect market expectations of the
level of the AMERIBIOR Term-90 benchmark rate on the final
settlement date for the applicable AMT3 futures. To learn more
about these AMT3 futures and Cboe's 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
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Analyst
Contact
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Angela
Tu
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Tim
Cave
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Kenneth Hill,
CFA
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+1-646-856-8734
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+44 (0)
7593-506-719
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1-312-786-7559
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atu@cboe.com
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tcave@cboe.com
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khill@cboe.com
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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™ is a trademark of American Financial Exchange, LLC.
AMERIBOR® is a registered trademark of Environmental Financial
Products, LLC, and has been licensed for use by CFE in connection
with the listing for trading by CFE of AMERIBOR futures. All
other trademarks and service marks are the property of their
respective owners.
Any third-party products that have the AMERIBOR® Term-90
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 an AMERIBOR benchmark 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
benchmarks 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 change
or changes in tax regimes; 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; factors that
impact the quality and integrity of our indices; 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.