Profile: CME Group Inc. (CME.O)

CME Group Inc., formerly Chicago Mercantile Exchange Holdings Inc., offers access to asset classes from a single electronic trading platform and trading floors in Chicago and New York City. The Company offers futures and options on futures based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, and alternative investment products, such as weather and real estate. During the year ended December 31, 2008, the combined volume of CME and CBOT and NYMEX was approximately three billion contracts. As of December 31, 2008, the Company’s open interest stood at 63 million contracts and its open interest record was 86.1 million contracts set on September 11, 2008. In March 2008, the Company acquired Credit Market Analysis Limited (CMA), a provider of credit derivatives market data. On August 22, 2008, the Company completed its merger with NYMEX Holdings, Inc. (NYMEX Holdings). In April 2009, the Company acquired the Carvill Hurricane Index from Carvill America Inc. and renamed it the CME Hurricane Index.

The Company’s products provide a means for hedging, speculation and asset allocation relating to the risks associated with, among other things, interest rate sensitive instruments, equity ownership, changes in the value of foreign currency and changes in the prices of commodities. These include products based on the entire United States interest rate yield curve, equity indexes, foreign exchange, agricultural commodities, energy, metals and alternative investment products. Its customer base includes professional traders, financial institutions, institutional and individual investors, corporations, manufacturers, producers and governments. It provides facilities to conduct open outcry and electronic trading and it matches, clears and guarantees trades executed on its exchanges and certain bilateral trades executed off-exchange.

Interest Rate Products

CME Group Inc.’s interest rate products enable banks and other financial institutions worldwide to hedge interest rate risks. Its interest rate products allow its customers to execute transactions across the entire United States dollar-denominated yield curve. Customers may manage short-, medium- and long-term interest rate risk using the Company’s products based on Eurodollars, United States Treasuries, swaps and other dollar-related instruments. As a result of the Company’s acquisition of CBOT, its interest rate products include CBOT’s 30 year United States Treasury bond futures and options on futures and ten-year, five-year and two-year United States Treasury note futures and options, and interest rate swap futures and options and federal funds futures and options.

Equity Products

The Company’s equity products permit investors to obtain exposure, for hedging or speculative purposes, to a change in the weighting of one or more equity market sectors. It is an equity index marketplace, offering futures and options products (including its E-mini contracts) on key benchmark equity indexes covering small-, medium- and large-cap companies in the United States, Europe and Asia. These include the Standard & Poor’s, Dow Jones, NASDAQ, Nikkei, MSCI and FTSE/Xinhua indexes, and others. The Company has licensing arrangements with Standard & Poor’s Corporation (S&P), The Nasdaq Stock Market, Inc. (NASDAQ) and Dow Jones & Company, Inc. (Dow Jones), which allow its to offer futures and options on futures on their indexes, including its contracts based on the S&P 500 Index, the NASDAQ-100 Index and the Dow Jones Industrial Average.

Foreign Exchange Products

The Company’s foreign exchange market serves as a means of risk transfer for the global foreign exchange market, bringing together an array of client segments by offering investment, as well as risk management opportunities. Its foreign exchange products provide the tools and resources to hedge foreign exchange risk, facilitating cross-border trade and commerce, while mitigating the risks to profitability due to fluctuations in the foreign exchange market. Its foreign exchange market attracts both buy- and sell-side investors, including commercial and investment banks, hedge funds, commodity trading advisors, trading firms and individual investors. Approximately 95% of the Company’s foreign exchange products are traded electronically on the CME Globex platform. The Company offers approximately 40 foreign exchange futures and approximately 30 foreign exchange options on futures products, covering a range of emerging market currency pairs in more than 20 different currencies.

Commodity and Alternative Investment Products

CME Group Inc. commodity and alternative investment products provide hedging tools for the Company’s customers, who deal in tangible physical commodities, including agricultural producers of commodities, food processors and consumers of energy. The Company has maintained a franchise in its commodity products, including futures contracts based on cattle, hogs, pork bellies, lumber, dairy products, soybeans, corn, wheat, oats and rough rice. Its also provides customers with non-traditional, alternative investment products to diversify and manage their risk. The Company’s real estate products provide opportunities for risk protection. By providing a means of hedging exposure to real estate prices, customers can diffuse the impact of sustained declines in real estate prices. It also offers risk management products on the weather market through its weather contracts based on aggregate temperatures in more than 40 cities worldwide, as well as hurricane, snowfall and frost indexes. In September 2008, the Company sold the CBOT metals trading complex to NYSE Euronext.

Market Data and Information Products

The Company’s markets generate information regarding prices and trading activity in its products. It sells its market data, which includes information about bids, offers, trades and trade size in its products, to banks, broker-dealers, pension funds, investment companies, mutual funds, insurance companies, individual investors and other financial services companies or organizations that use the Company’s markets or monitor general economic conditions. The Company distributes its market data directly to its electronic trading customers as part of their access to the Company’s markets through its electronic facilities. It also distributes market data via dedicated networks to quote vendors who consolidate its market data with that from other exchanges, other third-party data providers and news services, and then resell their consolidated data.