CBOT Dec 2015 corn takes wild ride in overnight session
CHICAGO, Sept 10
CHICAGO, Sept 10 (Reuters) - The Chicago Board of Trade's December 2015 corn futures contract gyrated wildly on Monday night, experiencing a 22-1/2-cent price swing in the first hour of the overnight session due to what traders said appeared to be an erroneous order entry.
The activity highlights the volatility of the all-electronic overnight session, when volume is typically thin and so-called fat finger trades can quickly send prices out of line.
"If that order was in the pit, it would have never happened," said Tom Grisafi, president of agricultural advisory service Trade the Farm LLC. A floor broker would have double checked to make sure someone wanted to make a deal that was 10 cents below the market before executing it, he said.
The CME Group, parent of CBOT, was unavailable for comment.
The December 2015 corn contract opened overnight at $4.98-1/2 a bushel and then quickly dropped to session low of $4.87-1/2 within 3 minutes. The market rebounded minutes later, topping out at $5.10.
The trader likely unwound the mistake made at the open, Grisafi said.
December 2013 corn, which is currently the Chicago Board of Trade's most actively traded corn futures contract, traded in just a 2-cent range during the same time frame.
Volume for December 2015 futures during the first hour of trading was 832 contracts, making it the busiest hour for the contract on record. The next most active hour was between 1 p.m. and 2 p.m. on August 14, when 177 contracts changed hands.
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