CORRECTING and REPLACING: CME Group to Launch First-Ever Water Futures Based on Nasdaq Veles California Water Index
September 17 2020 - 10:05AM
In a release issued under the same headline on Thursday, September
17th by Nasdaq, Inc., please note that a link in the contact
information was leading to an inactive web page. The link has been
updated and the corrected release follows:
CME Group, the world's leading and most diverse derivatives
marketplace, and Nasdaq, a global technology company serving the
capital markets and other industries, today announced plans for a
new futures contract on the Nasdaq Veles California Water Index
(NQH2O). CME Group will launch its new Nasdaq Veles California
Water Index futures contract in late Q4, pending regulatory
review.
Nasdaq Veles California Water Index futures will be an
innovative, first-of-its-kind tool to provide agricultural,
commercial, and municipal water users with greater transparency,
price discovery, and risk transfer – all of which can help to more
efficiently align supply and demand of this vital resource.
“With nearly two-thirds of the world’s population expected to
face water shortages by 2025, water scarcity presents a growing
risk for businesses and communities around the world, and
particularly for the $1.1 billion California water market,” said
Tim McCourt, CME Group Global Head of Equity Index and Alternative
Investment Products. “Developing risk management tools that address
growing environmental concerns is increasingly important to CME
Group. This innovative, new water contract builds on our strong
partnership with Nasdaq, as well as our proven 175-year track
record of helping end users and other market participants manage
risk in essential commodity markets including agriculture, energy,
and metals.”
“The Nasdaq Veles California Water Index helps drive better
outcomes for water market participants through verifiable price
discovery,” said Lauren Dillard, Executive Vice President and Head
of Nasdaq Global Information Services. “Our collaboration with CME
Group has the power to deliver greater transparency around the
management of an important natural resource.”
A liquid, transparent futures market will help to create a
forward curve so water users can hedge future price risk. For
example, 40% of water currently consumed in California is used to
irrigate its nine million acres of crops. Nasdaq Veles California
Water Index futures would allow an agricultural producer to plan
ahead for changing costs of the water they need for large-scale
irrigation. It would also allow a commercial end user, like a
manufacturer, to better navigate business and financial risks when
water prices fluctuate.
The new California water futures contract will be financially
settled based on the Nasdaq Veles California Water Index launched
in 2018, with each contract representing 10 acre-feet of water. The
index sets a weekly benchmark spot price of water rights in
California, based on the volume-weighted average of the transaction
prices in California’s five largest and most actively traded water
markets. Nasdaq developed the NQH2O Index in partnership with Veles
Water Limited, a firm specializing in the development of financial
products for water markets. The data utilized in the calculation of
the index is provided by WestWater Research, an economic consulting
firm focused on pricing, valuation, and transaction advisory
services for water rights and water resource development.
Nasdaq Veles California Water Index futures will be listed by
and subject to the rules of CME. For more information and contract
specifications, please visit www.cmegroup.com/waterfutures. For
more information on the NQH20 Index, visit
www.Nasdaq.com/waterindexes.
About CME GroupAs the world's leading and most
diverse derivatives marketplace, CME Group (www.cmegroup.com)
enables clients to trade futures, options, cash and OTC markets,
optimize portfolios, and analyze data – empowering market
participants worldwide to efficiently manage risk and capture
opportunities. CME Group exchanges offer the widest range of global
benchmark products across all major asset classes based
on interest rates, equity indexes, foreign
exchange, energy, agricultural
products and metals. The company offers futures and
options on futures trading through the CME Globex® platform,
fixed income trading via BrokerTec and foreign exchange trading on
the EBS platform. In addition, it operates one of the world's
leading central counterparty clearing providers, CME Clearing. With
a range of pre- and post-trade products and services underpinning
the entire lifecycle of a trade, CME Group also offers optimization
and reconciliation services through TriOptima, and trade processing
services through Traiana.
CME Group, the Globe logo, CME, Chicago Mercantile Exchange,
Globex, and, E-mini are trademarks of Chicago Mercantile Exchange
Inc. CBOT and Chicago Board of Trade are trademarks of
Board of Trade of the City of Chicago, Inc. NYMEX, New York
Mercantile Exchange and ClearPort are trademarks of New York
Mercantile Exchange, Inc. COMEX is a trademark of Commodity
Exchange, Inc. BrokerTec, EBS, TriOptima, and Traiana are
trademarks of BrokerTec Europe LTD, EBS Group LTD, TriOptima AB,
and Traiana, Inc., respectively. Dow Jones, Dow Jones Industrial
Average, S&P 500 and S&P are service and/or trademarks of
Dow Jones Trademark Holdings LLC, Standard & Poor's Financial
Services LLC and S&P/Dow Jones Indices LLC, as the case may be,
and have been licensed for use by Chicago Mercantile Exchange Inc.
All other trademarks are the property of their respective
owners.
About NasdaqNasdaq (Nasdaq: NDAQ) is a global
technology company serving the capital markets and other
industries. Our diverse offering of data, analytics, software and
services enables clients to optimize and execute their business
vision with confidence. To learn more about the company, technology
solutions and career opportunities, visit us on LinkedIn, on
Twitter @Nasdaq, or at www.nasdaq.com.
CME
Group Media Contacts |
Nasdaq
Media Contact |
Chris Grams, +1 312 930 3435 |
Matthew Sheahan, + 1 646 284 8573 |
Liz McGee, +1 312 206 7186 |
matthew.sheahan@nasdaq.com |
news@cmegroup.com |
|
https://www.cmegroup.com/media-room.html |
Joe Christinat, +1 646 441 5121 |
|
Joseph.christinat@nasdaq.com |
CME Group Investor Contact |
|
John Peschier, 312.930.8491 |
|
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