CME Group, the world’s leading derivatives exchange, announced the launch of U.S. Dollar Denominated Ibovespa Futures to begin trading on October 22, 2012. These contracts are listed with, and subject to, the rules and regulations of CME.

“This cross-listing arrangement allows us to provide our core promise: ease of access, as well as more ways to manage risk for our global customers,” said Scot Warren, Senior Managing Director, Equity Index Products and Services at CME Group. “This new cross-listing arrangement provides our customers access to Brazil’s key benchmark product. This initiative will allow our clients to improve their ability to manage market and counterparty credit risk exposure across various asset classes.”

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The Brazilian Stock Index, one of the most liquid in South America is trading at 59,921.80.

“Our long-standing strategic partnership with CME Group allows us to offer products such as this which will provide exposure to Brazil with collateral efficiencies since CME Clearing will clear the product,” said Marcelo Maziero, BM&FBOVESPA Chief Product and Customer Officer.

The Ibovespa is a total return index of 69 stocks traded on BM&FBOVESPA, the Brazilian Stocks, Mercantile & Futures Exchange. The index is comprised of a theoretical portfolio of the stocks that accounted for 80 percent of the volume traded in the last 12 months and that were traded on at least 80 percent of the trading days. On September 6, 2012, the components of Ibovespa represented 78.1 percent of all the stock market capitalization. Due to the fact that the Sao Paulo Stock Exchange updates the theoretical portfolio of the Ibovespa every four months, there may be changes in its composition during the life of a futures contract.

Brazil and the LATAM region at large are key markets for financial firms offering FX and CFD products, Forex Magnates team have written a detailed report on the market, the opportunities, the threats and the potential. Available in the forthcoming Q3 quarterly report.