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Chicago Mercantile Exchange (CME) Group Introduces Self-Match Prevention

On June 17, the Chicago Mercantile Exchange, Chicago Board of Trade, New York Mercantile Exchange and Kansas City Board of Trade issued an advisory notice that provides updated guidance on compliance with the exchanges’ rules prohibiting wash trades, as well as information regarding the introduction of self-match prevention functionality on CME Globex. Beginning in June, the exchanges will introduce an optional self-match prevention functionality that, when employed, will automatically block the matching of buy and sell orders that are submitted to CME Globex with the same executing firm ID and the same self-match prevention ID. When the self-matching function is enabled, the trading engine will prevent opposing orders that have been entered with the same self-match prevention ID from matching by cancelling the resting order(s) and processing the incoming order.  

Additional information on the self-matching prevention functionality and registration process for obtaining self-match prevention IDs can be found here

The Market Regulation Advisory Notice is available here.

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©2021 Katten Muchin Rosenman LLPNational Law Review, Volume III, Number 174
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About this Author

Kevin M. Foley, Finance Lawyer, Katten Llaw Firm
Partner

Kevin M. Foley has extensive experience in commodities law and advises a wide range of clients, both in the United States and abroad, on compliance with the Commodity Exchange Act and the rules of the Commodity Futures Trading Commission (CFTC) affecting traditional exchange-traded products, as well as the over-the-counter markets involving swaps and other derivative instruments. His clients include futures commission merchants, derivatives clearing organizations, designated contract markets, foreign boards of trade and an industry trade association.

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