About CME Russian Ruble Futures

CME® Russian ruble futures and options on futures contracts offer financial institutions, investment managers, corporations and private investors the right tools to take advantage of, and to manage, the risks associated with the fluctuation of the ruble versus the U.S. dollar.

The ruble is the currency of the Russian Federation, and formerly the Soviet Union. One ruble can be divided into 100 kopeks.

CME Russian ruble contracts were introduced in 1998 to provide an innovative risk management tool for those interested in the myriad investment opportunities provided by the developing Russian economy. As part of its Emerging Market Futures, CME relaunched the ruble contract in 2000 with notable differences from its orginal contract in that the contract size is significantly larger, while the tick specifications have been changed.

Specifcally, the revised ruble contract is sized at 2.5 million rubles, a fivefold increase from 500,000, and have a value of about $85,000. The point value of the tick has been reduced to $.00001 from $.000025, while the dollar value has been increased to $25 from $12.50. Both CME Russian ruble futures and options on futures contracts trade four months in the March quarterly cycle: March, June, September and December. These changes make the ruble contract more directly comparable to other CME FX contracts.

Futures contracts are quoted in U.S. dollars per ruble, and call for cash settlement at expiration. There is no physical exchange of Russian rubles for U.S. dollars on the delivery date. On the business day preceding the last trading day, CME will mark all open Russian ruble positions to the settlement price determined in the futures pit. Then trading in the expiring contract continues on CME Globex® from 2:00 p.m. until 11:00 a.m. Moscow time (usually 2:00 a.m. CT) on the contract’s termination of trading day. All open positions at termination are then cash-settled to the reciprocal of the result of the CME/EMTA Russian Ruble per U.S. Dollar Reference Rate survey procedure. Exercised options on futures contracts are settled by the delivery of futures contracts.

Unique Features

There are two main differences between traditional CME FX futures contracts and the CME Russian ruble contract: the last trading day and the final settlement procedure.

• CME Russian ruble futures trading terminates on the 15th calendar day of the contract month at 11 a.m. Moscow time. This is usually 2 a.m. Chicago time (CT), but may be either 1 a.m. or 3 a.m.(CT) when Daylight Saving Time is in effect in either, but not both, Moscow or Chicago. If that day is not a business day for the Moscow interbank foreign exchange market, then trading will end at the same time on the next Moscow interbank foreign exchange market business day.
• CME Russian ruble futures are cash-settled, much like the CME Brazilian real contract.

Exchange Controls

Russian currency law imposes certain foreign exchange controls. A primary restriction is that the ruble is convertible mainly for current account transactions. As a result, an active non-deliverable forward (NDF) market has developed, whereby forward ruble positions are settled at expiration in U.S. dollars. One of the most widely used reference rates for settlement of these contracts is the CME/EMTA Russian Ruble per U.S. Dollar Reference Rate. This daily spot rate was developed jointly by CME and the Emerging Markets Traders Association (EMTA). The CME Clearing House surveys reference institutions in Russia daily and publishes the results of its spot rate survey. CME Russian ruble futures and options on futures cash settle to this rate at termination.

To comply with current exchange control regulations, CME Russian ruble contracts are cash-settled. That is, upon final settlement, only U.S. dollars will be transferred between accounts and there will be no delivery of rubles. The reference rate used for final settlement of the CME contracts will be the reciprocal of the CME/EMTA Russian Ruble per U.S. Dollar Reference Rate on the termination of trading day.