Gill said the company "fully expected" the ruling by a Chicago judge on Monday allowing the grain traders to go ahead with a lawsuit to overturn the CME's new end-of-day settlement rules that they say are killing business in the trading pits. The CME has no plans to withdraw the new settlement rules that include transactions done electronically, where the bulk of the volume comes from.
"It has to make sense to our client base not just to a small group of traders who somehow feel that they have been displaced," said Gill, who is in Singapore for a derivatives industry conference. Prior to the change, CME had a century-old tradition of settling futures prices for crops like corn and soybeans based on transactions executed in the pits.
Gill said the bourse has no plans to close floor trading as long as liquidity was there. "If the liquidity exists, why kill the goose? It's profitable, it's not an issue to us. The customers have chosen to stay on the floor, why would we shut it down? It makes no sense."
The change in settlement rules "has caused a rapid, dramatic decrease in trades" for floor traders and "will eventually effectively eliminate the CBOT open outcry market for agricultural futures," according to the lawsuit. Malaysia-born Gill took the helm at the Chicago-based company in May with plans to make the 164-year-old US futures powerhouse more international.