Bursa Malaysia Berhad (Bursa Malaysia) and CME Group (CME) have formed a collaboration to develop a robust derivatives market. It involves trade matching services, product licensing and minor cross-equity investments. Accordingly, the CME’s equity stake will relate to Bursa Malaysia’s derivatives business.
With this strategic partnership, CME is expected to use Bursa Malaysia’s RM-denominated CPO futures contract (FCPO) settlement prices, which enables it to develop a USD-denominated cash-settled CPO futures contract and its related options for listing on one of CME Group’s US registered exchanges. This product is expected to be traded on CME Globex, which is CME Group’s electronic trading platform.
Dato’ Yusli Mohamed Yusoff, CEO of Bursa Malaysia, said: The proposed collaboration is aimed at globalising the Malaysian crude palm oil (CPO) futures market. Consequently, part of this proposed collaboration will enable Bursa Malaysia Derivatives to list its derivatives products on CME Globex. Through this collaboration, we expect the resulting expertise and knowledge transfer to further facilitate our goal for a robust derivatives exchange.
Terry Duffy, executive chairman of CME Group, said: This initiative, when implemented, will enable our customers from other markets to access Bursa Malaysia’s derivatives markets and products on CME Globex, the leading and most widely distributed electronic trading platform in the world, further demonstrating our flexibility to operate in multiple jurisdictions for the benefit of customers worldwide.
Bursa Malaysia is an approved exchange holding company under Section 15 of the Capital Markets and Services Act 2007.
