In a continuing quest to draw more business to the Chicago Board of Trade, market leaders have launched two new trading products which, so far, are exemplary of the well-known pithy saying: You win some, and you lose some.
The two contracts, a flexible Treasury option and a structural panel index, are central to a never-ending goal of the CBOT, and futures markets everywhere, to develop a product that will catch fire among investors and take trading volume, already at record levels, to new heights.
The flexible option, aimed at drawing business from the over-the-counter markets, has been a pleasant surprise for CBOT leaders. Since its quiet Jan. 9 launch, it has averaged 1,759 contracts daily, a level that usually accompanies contracts that have been trading for months. But the structural panel futures, an index enabling construction industry participants to hedge certain building material costs, has had a less spectacular start. The contract blasted off Tuesday with 200 contracts changing hands, but only a handful changed hands Wednesday through Friday. Studies show that new products launched at the CBOT, the Chicago Mercantile Exchange and the nation’s nine other futures markets failed about half the time in the last two years.
