august 2012. agenda introduction how to participate? products overview and trading ideas final...
TRANSCRIPT
August 2012
Agenda
Introduction
How to participate?
Products overview and Trading Ideas
Final Remarks
Introduction
• MexDer is the derivatives subsidiary of BMV Group the financial exchange operator in Mexico.
• Fully electronic market place, as a self-regulated
exchange it has a flexible legal framework.
• CME Group and MexDer joined forces to link the trading platforms, a world of opportunities is brought closer to you.
• MexDer is the leading market place for trading derivatives
on Mexican benchmarks.
Making sense of MexDer With the CME Group – MexDer order routing agreement MexDer products will be
available in more than 100,000 CME Globex® screens.
No Withholding Taxes when trading in MexDer.
Free Convertibility.
Active participation of foreigners in the underling.
No local presence required in Mexico.
Omnibus Accounts: Rule 30.7 (CFTC) segregation (anonymous) One for Proprietary trading. One for Customer trading.
CFTC approved products
Co-location
DMA
Collaterals accepted in the US.
Remote Membership.
Give Ups.
Making sense of MexDer With the CME Group – MexDer order routing agreement MexDer products will be
available in more than 100,000 CME Globex® screens.
No Withholding Taxes when trading in MexDer.
Free Convertibility.
Active participation of foreigners in the underling.
No local presence required in Mexico.
Omnibus Accounts: Rule 30.7 (CFTC) segregation (anonymous) One for Proprietary trading. One for Customer trading.
CFTC approved products
Co-location
DMA
Collaterals accepted in the US.
Remote Membership.
Give Ups.
6 Clearing Members.
46 Mexican Trading Members.
8 Active Remote Members.
20 Market Makers.
Participants
Liquidity and Strength - AAA Clearing House - Asigna
Fitch Rating
Standard & Poor’s
Moody’s
Local RatingAAA (mex)
mxAAA/mxA-1+ local currency
Aaa.MX
Global Rating
BBB+/A-2 local currency
A2
Collaterals Accepted
Accepted in the US
US Dollar (cash).
T-Bills.
T-Notes
Accepted in Mexico
Eligible Mexican Stocks
Eligible Mexican Bonds
Cetes (Mexican Treasury Bills)
Order Routing Agreement (CME-MexDer)
N2SCME members and its
clients are be able to trade MexDer’s products.
MexDer’s products could be
traded in the 100,000 CME’s GLOBEX® connections.
S2NMexDer’s member and its
clients will have access to all the CME products through MexDer’s screen.
Risk Management Gateway (RMG)
Overview.
The Risk Management Gateway (RMG) is a web-based dashboard used to monitor, configure and control Futures & Options “Orders” and “Risk Filters” within the RMG system.
Mexican Clearing firms will be responsible to control and configure those risk filters and view order blotter for accounts which they are entitled to see, only for their customers.
The RMG dashboard provides access to the following functions:
Viewing orders Viewing order message chains Cancelling orders Viewing risk filters Creating risk filters Modifying risk filters Deleting risk filters Enabling risk filters Disabling risk filters
Pre-Trade Checks
“Quantity” FilterReject any order with size bigger than a specified number, this filter applies for any asset class product (Futures or Options).
“Quantity per Symbol and Side” FilterReject any order with size bigger than a specified number on a specific class and side
“Symbol, Side, Order Type, Time in Force” Filter”Reject any order matching a specific combination of symbol, side, order type, time in force and a time window (start time and end time).
“Value” FilterReject any order exceeding a specified value (notional value)
Risk Management Gateway (RMG)
Aggregated Checks
Daily Credit Limit Control for Net Long/Short Margin
Reject any order exceeding the limit margin set by symbol once the aggregated amount has reached the set limit.
“Daily Quantity” Filter
If the aggregated traded volume exceeds the specified value for the day, cancels and or rejects the orders resting on the book and the incoming ones. If an order is cancelled, the unfilled quantity should be removed from the day’s accumulated quantity. If an order is modified, the number of contracts should be added or removed from the day’s aggregated total. The Clearing Firm can optionally set the Side field to only check daily value for a particular side. If Side is unset it will be ignored and treated as a wildcard.
“Daily Quantity per Symbol and Side” Filter
Reject any order that exceeds the maximum daily quantity for a daily quantity entry. An entry consists of a symbol, side, and maximum daily value. Each entry maintains its own limit and tracking. When orders exceed a limit on an entry it should only reject orders matching that entry. Other entries that have not exceeded their threshold should continue to allow orders through.
Risk Management Gateway (RMG)
“Daily Value” Filter
The RMG will cancel the orders resting on the book and not allow new orders into the trading engine if the notional value exceeds the specified value for the day.
If an order is cancelled or modified in size, the change in value will be removed or added to the day’s aggregated total.
“Daily Value per Symbol and Side” Filter
The RMG will cancel the orders resting on the book and not allow new orders into the trading engine if the notional value exceeds the specified value per side for the day.
If an order is cancelled or modified in size, the change in value will be removed or added to the day’s aggregated total.
Risk Management Gateway (RMG)
Agenda
Introduction
How to participate?
Products overview and Trading Ideas
Final Remarks
Mexico GLOBEX Hub
Match Engine
40 Mbps line
40 Mbps line
Lines to GLOBEX
GLOBEX Infrastructure
USUS
MEXICOMEXICO
MCM(Asigna Clearing Member)
(One letter to access MexDer directly)
Business Opportunities in MexDer
HF Trader
Fund
HF Trader
Clearing Member at CME Group
Customers trade directly through certified trading
systems.
DMA
Paperwork required
How to participate?
1. As a Member of a Recognized Market
2. As an Omnibus Account in MexDer
3. As a Client of a MexDer Omnibus Account
4. As a Remote Member
http://www.mexder.com/MEX/Open_an_Account_-_Trading_and_Clearing_Members.html
How to participate?
1. As a Member of a Recognized Market. Fastest and easiest way to take advantage of the CME
Group – MexDer order routing agreement (ORA) .
Have access to CME Globex
Direct execution in MexDer, Co-location available.
Clears through a MexDer Clearing Member (MCM), the only paperwork required.
2. As a MexDer Omnibus Account.
3. As a client of a MexDer Omnibus account.
4. As a Remote Member. Non-Clearing Remote Membership with direct access to the trading system clearing
through a local Clearing Member
http://www.mexder.com/MEX/Open_an_Account_-_Trading_and_Clearing_Members.html
Mexico GLOBEX Hub
Match Engine
40 Mbps line
40 Mbps line
CMEG Member:As a Client of an
MCM
Lines to GLOBEX
GLOBEX Infrastructure
USUS
MEXICOMEXICO
MCM(Asigna Clearing Member)
(Paperwork required)
Account with MCM required
(1) As a Member of a Recognized Market
Co-location available
How to participate?1. As a Member of a Recognized Market
Executing as a customer of a Trading Member or even through an Omnibus Account.
2. As a MexDer Omnibus Account. The CME member that qualifies as an omnibus
account executes directly in MexDer and
clears through a MexDer Clearing Member. Minimum legal paperwork required with
MexDer. The omnibus clients identity is not disclosed.
3. As a client of a MexDer Omnibus account
4. As a Remote Member. Non-Clearing Remote Membership with direct access to the trading system clearing
through a local Clearing Memberhttp://www.mexder.com/MEX/Open_an_Account_-_Trading_and_Clearing_Members.html
(2) As a MexDer Omnibus Account
Mexico GLOBEX Hub
Match Engine
40 Mbps line
40 Mbps line
CMEG Member :As a MexDer Omnibus
Account
Lines to GLOBEX
GLOBEX Infrastructure
USUS
MEXICOMEXICO
MCM(Asigna Clearing Member)
(Paperwork required)
Account with MCM required
How to participate?1. As a Member of a Recognized Market.
Executing as a customer of a Trading Member or even through an Omnibus Account.
2. As a MexDer Omnibus Account . The CME member that qualifies as an omnibus account executes directly in
MexDer and clears through a MexDer Clearing Member. The omnibus clients identity is not disclosed.
3. As a client of a MexDer Omnibus account When executing through an Omnibus Account, you will
only need one simple letter to notify MexDer. Trade through your existing agreement with the CME
Member (registered omnibus in MexDer)4. As a Remote Member.
Non-Clearing Remote Membership with direct access to the trading system and clearing through a local Clearing Member
http://www.mexder.com/MEX/Open_an_Account_-_Trading_and_Clearing_Members.html
Mexico GLOBEX Hub
Match Engine
40 Mbps line
40 Mbps line
Customer:As a Client of a MexDer
Omnibus Account
Lines to GLOBEX
GLOBEX Infrastructure
USUS
MEXICOMEXICO
(3) As a Client of a MexDer Omnibus account
MCM(Asigna Clearing Member)
CMEG Member:
Omnibus Account
(One simple letter to access MexDer directly)
How to participate?1. As a Member of a Recognized Market.
Executing as a customer of a Trading Member or even through an Omnibus Account.
2. As a MexDer Omnibus Account . The CME member that qualifies as an omnibus account executes directly in MexDer
and clears through a MexDer Clearing Member.
The omnibus clients identity is not disclosed.3. As a client of a MexDer Omnibus account
4. As a Remote Member. Non-Clearing Remote Membership with direct access to
the trading system.
Legal paperwork required with the Exchange.
Clear through a MexDer Clearing Member.
http://www.mexder.com/MEX/Open_an_Account_-_Trading_and_Clearing_Members.html
(4) As a Remote Member
Mexico GLOBEX Hub
Match Engine
40 Mbps line
40 Mbps line
Lines to GLOBEX
GLOBEX Infrastructure
USUS
MEXICOMEXICO
(Paperwork required)
Account with MexDer Clearing Member required
MCM(Asigna Clearing Member)
(Paperwork required) Co-location available
CMEG Member:
MexDer member & Omnibus Account
FIX Access
MexDer provides Access via (FIX) protocol
Certified ISV’s in MexDer: Certified ISV’s in Globex to trade MexDer:
**Proprietary trading systems.
Agenda
Introduction
How to participate?
Products overview and Trading Ideas
Final Remarks
Products overview
ILCTRAC
BCTRAC
Products available through the CME ORA
Asset Class Futures Globex Symbol
FX Dollar-Peso Futures M:DA
FX Euro Futures M:Euro
FX Monthly Dollar-Peso Futures M:DEUA
Equity Index IPC Index Futures M:IPC
Equity Index Options on Mexican Stock Exchange M:IP
Equity Index Rollover Futures for IPC M:SIPC
Interest Rates 3-Year Bond Futures M:M3
Interest Rates 5-Year Bond Futures M:M5
Interest Rates 10-Year Bond Futures M:M10
Interest Rates 20 -Year Bond Futures M:M20
Interest Rates 30-Year Bond Futures M:M30
Interest Rates 28-Day Interbank IR Futures M:TE28
Interest Rates 91-Day T Bill Futures M:CE91
Interest Rates 2-Year (26x1) IR Swap Futures M:02
Products available through the CME ORA… cont
Asset Class Futures Globex Symbol
Interest Rates 10-Year (130x1) IR Swap Futures M:10
Interest Rates 10-Year IR Swap Futures M:SW10
Inflation Index Inflation Index Futures M:UDI
Single Stock Futures* América Móvil L M:AXL
Single Stock Futures* Cemex CPO M:CXC
Single Stock Futures* Femsa UBD M:FEM
Single Stock Futures* Gcarso A1 M:GCA
Single Stock Futures* Telmex L M:TXL
Single Stock Futures* Walmex V M:WAL
Single Stock Futures* BRTRAC 10 M:BRT
Single Stock Futures* ILCTRAC ISHRS M:ILC
Single Stock Futures* GMEXICO M:GMEX
Single Stock Futures* CEMEX M:CXCA
Single Stock Futures* Rollover Futures for AXL M:SAXL
* U.S. market based participants are restricted from trading the Single Stock Futures
For more information on MexDer products, please visit www.mexder.com.mx
Bond Futures & Trading Ideas…
Underlying, Bonds issued by the Mexican government (BBB+).
The most actively traded securities in Mexico.
A benchmark for Mexican domestic interest rates.
Most efficient way to hedge and short positions.
Spread Trades and arbitrage opportunities. Adjust portfolio duration.
Anticipate shift in slope of yield curve.
Take advantage of perceived price anomalies.
Settled through physical delivery using conversion factor pricing.
Common denominator to spread: CTD (Cheapest to Delivery).
Bond Futures & Trading Ideas…
Source: Banxico
Trade the whole yield curve of the Mexican Sovereign that is available:
3 Year Bond (M3) 5 Year Bond (M5) 10 Year Bond (M10) 20 Year Bond (M20) 30 Year Bond (M30)+ 91 Day Treasury CETE.
Foreign Investment in MXP Debt Government Securities
Bond Futures & Trading Ideas…
IPC Index Futures & Trading Ideas…
The IPC is a capitalization Index and the leading indicator of the Mexican Stock Exchange performance.
The easiest and cheapest way to hedge and short the Mexican equity market.
Active participation of local and foreign investors
Return
2012: 7.96% MXN / 15.06% USD**
MexDer Ticker Symbol: IPC
Quotation: IPC Points
Size: IPC x $10 MXP
Tick: 5 points
Maturity Months:Quarterly,
up to one year
Settlement: Cash
Trading Hours:07:30 - 15 hrs.
(GMT -06:00)
Bloomberg < MMDD >ISA <INDEX>
CT
Reuters MXN/FUTEX1 0#IPC:
Several opportunities available with the Future of the IPC spreads with:
IPC Future vs S&P 500 E-mini. IPC Future vs Naftrac and EWW (ETFs) . IPC Future vs Equity cash basket. IPC Future vs Mexican ADR’s.
Common denominator: Contracts notional / Face value.
IPC Index Futures & Trading Ideas…
Options on the IPC Future
This contract gives access to volatility trading on the IPC and represents an efficient hedging tool for Mexican equities.
CFTC approved product.
Liquidity - Constant bids and asks in the front maturities and in a wide range of strike prices.
MexDer
Ticker Symbol:IP
Style: European
Size: IPC x $10 MXP
Tick: 1 point
Maturity Months:Quarterly,
up to one year
Settlement: Cash
Trading Hours:07:30 - 15 hrs.
(GMT -06:00)
Bloomberg < MMDD >ISA
<INDEX> OMON
Reuters MXN/FUTEX1 0#IPC*.XD:
Implied Volatility: 14.96% **
Volatility Index Mexico (VIMEX) vs VIX®
USD/MXN Future Contract
USD/MXN volume increased due to the local pension funds.
Active participation of domestic, foreign members and local pension funds.
Arbitrage opportunities with the CME MXN/USD Futures.
Agenda
Introduction
How to participate?
Products overview and Trading Ideas
Final Remarks
Final remarks
• Opportunity to participate in a developing market .• End customers, FCMs, prop traders, high
frequency traders.
• Easy access
• Market Making incentive program.
• Liquidity and depth in the underlying securities; development in their derivatives contracts to follow.
• Be part of the development of this new and exciting market!
38
It’s never been so easy….
Contact Us!
+52 (55)
5342-9930
From the US:
1 866 MEXDER1
The leading Marketplace for trading derivatives on Mexican benchmarks
Berenice Corral