(Bloomberg) — CME Group Inc. ended electronic trading in the largest Dow Jones Industrial Average and Nasdaq 100 Index futures, leaving smaller versions and exchange-traded funds as the main vehicles for off-hours speculation.
Traders will have to wait until the start of floor trading at 8:30 a.m. Chicago time before they can buy and sell full- sized versions of the equity benchmark futures. Contracts known as E-Mini Dow, which cost half as much, and E-Mini Nasdaq futures, which are priced at 1/5th the full contract, still trade electronically.
The popularity the larger contracts has dwindled as traders switched to bite-sized versions and ETFs, with Dow futures volume slumping to a daily average of 400 contracts this year from almost 4,000 in 2008, according to data compiled by Bloomberg. Volume in full-sized Nasdaq 100 futures has been around 800 a day since 2013, down from about 4,850 in 2008.
I do look at these contracts, but do not include them on a daily basis as the S&P 500 gives a better overview of the whole market, said Andy Dodd, a technical analyst and sales trader at Louis Capital Markets LLP in London. The Dow is only 30 stocks. It hardly gives an overall view of corporate America in my view. I didnt even notice they werent quoting this morning!
CME announced that it would remove derivatives on both stock gauges from its Globex platform in online statements dated Feb. 23. The decision took effect today.
Trading on the Standard & Poors 500 Index — the most popular measure of the U.S. equity market — was unaffected. The average daily number of futures changing hands on the Dow Average in the last month was only 1.7 percent of volume in S&P 500 contracts, according to data compiled by Bloomberg. Nasdaq 100 futures trading was only 6.9 percent that of the S&P 500.
