Contract History
If you are interested in trading Canadian dollar futures it is helpful to become familiar with the history of the
Canadian Dollar market. CME Canadian dollar futures and options on futures contracts offer financial institutions, investment
managers, corporations and private investors with a means to manage risks associated with currency rate fluctuation and to
take advantage of profit opportunities stemming from changes in currency rates.
CME
Canadian dollar futures contracts first started trading in 1972 as part of the International Monetary Market, a division
of the Exchange. Options contracts began trading in 1988. Currently CME offers a forum for trading Canadian dollars in its
FX futures markets on CME Globex as well as on the trading floor.
Futures
contracts are also traded in the CME Australian dollar/Canadian dollar, CME Canadian dollar/Japanese yen, and CME Euro FX/Canadian
dollar as part of cross rate currency futures.
CME Canadian dollar futures
and options on futures contracts are designed to reflect changes in the U.S. dollar value of the Canadian dollar. Futures
contracts are quoted in U.S. dollars per Canadian dollar, and call for physical delivery at expiration, which takes place
on the third Wednesday of the contract month in the country of issuance at a bank designated by the Clearing House. Exercised
options on futures are settled by the delivery of futures contracts.
The
CME anadian Dollar future contract’s trading unit is 100,000 Canadian dollars. The contract moves in 1 point tick increments,
which is $.0001 per Canadian dollar movement equals $10 per contract. Trading may also occur in $.00005 per Canadian dollar
increments, or $5.00 per contract, for Canadian dollar intra-currency spreads executed on the trading floor and electronically,
and for All-or-None transactions.
Futures contracts trade six months in
the March quarterly cycle, Mar, Jun, Sep, Dec; and options on futures trade four months in the March cycle and two months
not in the March cycle, plus four weekly expirations.
