EFP, EBF and EFR trades involve a futures contract and a spot commodity or cash position. The parties involved agree privately upon a price for a simultaneous exchange or transfer of "spot for futures" or "cash for futures" and then report the terms of this agreement to the clearing house.

The counterparties must follow strict exchange rules in conducting such trades, and in certain cases these trades must be approved in advance by the clearing house. EFPs, EBFs and EFRs are not official trades until the clearing house has matched and cleared them, and the first payment of settlement variation and performance bond has been confirmed.

• FX EFPs can be conducted with:
  • Spot currency
  • Currency forward transactions
• Eurodollar EBF trades can be transacted with:
  • U.S. Treasury instruments
  • Eurodollar Time Deposits
  • Forward Rate Agreements (FRAs)
  • Interest Rate Swaps
  • Collateralized Mortgage Obligations (CMOs)
  • Investment Grade Debt
  • Other instruments
• Swap EBF trades can be transacted with:
  • U.S. Treasury instruments
  • Interest Rate Swaps
  • Collateralized Mortgage Obligations (CMOs)
  • Investment Grade Debt
  • Other instruments
• Equity index EFPs can be transacted with:
  • Certain standardized stock baskets
  • Certain Exchange Traded Funds (ETFs)
• Acceptable cash sides for EFRs with agricultural futures are limited to:
  • The specific underlying commodities
  • Random Length Lumber contracts have additional requirements
• For Weather futures, acceptable cash instruments are selected Over-the-Counter (OTC) weather swaps

In all cases, the cash sides must be comparable with respect to quantity, value or risk exposure to the futures utilized.

• Convenience of private negotiation
• Can be used with numerous cash instruments and commodities
• For Eurodollars and Swaps, can be ideal for two parties seeking a Eurodollar or Swap futures transaction against a specific cash interest rate instrument
• Risk management provided by the Clearing House
• Offers straightforward trading method for parties with complementary objectives
• Designed to assist institutional trading needs

Faster and more convenient Block Trade Reporting. The safety and security of CME Group.

In mid- August CME Group will add a new trade capture web-based user interface, and an updated application programming interface (API) that will provide a new and more efficient means of reporting privately-negotiated trades and submitting them to CME Clearing. Available through our CME EOS Trader Web-based front end, CME Clearing360 Trade Reporter lets qualified market participants save time and execute more efficient Block Trades with the safety you have come to trust from CME Group.

Clearing360 and Trade Reporter will:

• Price all the legs of the strategy
• Verify that the trade conforms with minimum quantity rules
• Eliminate the need for a phone call to the Globex Control Center (GCC)
• Submit the trade directly to CME Clearing
• Enable the trade automatically to be loaded to the two clearing firms, once the trade has either passed a credit check on both sides, or been explicitly accepted

Learn more about Clearing360 Trade Reporter