Mutual Offset System
A special arrangement between CME Group and the Singapore Exchange (SGX), referred to as the Mutual Offset System (MOS), allows traders of both the Yen and USD denominated Nikkei 225 futures to take positions in the products at one exchange and offset them at the other one. The effect of this arrangement is to create one marketplace crossing different time zones as well as fungibility of contracts between the exchanges.
Our account holders may avail themselves of the MOS functionality by specifying at the point of trade entry both the proper underlying symbol and exchange. In the case of the Yen Denominated Nikkei 225 Index contract our underlying symbol is 'NIY' and the exchange either 'CME' (for contracts listed at and trading during CME hours) or 'SGXCME' (for contracts listed at and trading during SGX hours). In the case of the USD Denominated Nikkei 225 Index contract our underlying symbol is 'NKD' and the exchange either 'CME' (for contracts listed at the CME) or 'SGXCME' (for contracts listed at the SGX).
To illustrate the concept of fungibility, were an account holder to enter into a long futures position on the CME exchange and thereafter enter into a short futures position having the same underlying symbol and expiration date but listed on the SGXCME exchange, the effect would be the same as if that short position was executed on the CME exchange and that is to close the long position.
MOS also provides margin offset for positions entered into on either of the two exchanges in the manner noted above. Here, for example, a long futures position entered into from the CME exchange would be afforded spread margin treatment against a short position having the same underlying but a different expiration month which was entered into from the the SGXCME exchange. This effect is intended to be similar to that which would take place if both the long and short position were entered into from the same exchange.
IMPORTANT NOTE
We also offer trading in the identical SGX-listed futures contracts but without the MOS features of fungibility and margin offset as outlined above. In the case of the Yen Denominated Nikkei 225 Index, the contract having the underlying symbol 'SGXNK' and exchange of SGX is the functional equivalent of the 'NIY' contract having the exchange of SGXCME. Similarly, in the case of the USD Denominated Nikkei 225 Index, the contract having the underlying symbol 'N225U' and exchange of SGX is the functional equivalent of the 'NKD' contract having the exchange of SGXCME. It should be noted, however, that a long (short) position of a given expiration entered into on SGX exchange will not close out a short (long) position entered into on the SGXCME, or the CME for that matter. In addition, there is no margin offset provided between SGX-listed and SGXCME or CME contracts.
A table of trading hours for the MOS eligible products is provided below:
| Symbol | Description | Exchange | Trading Hours (ET)* |
|---|---|---|---|
| NIY | Yen Denominated Nikkei 225 Index | CME |
Mon-Fri 16:30 - 16:15 the next day (closing at 15:15 Friday); Daily maintenance shutdown 17:30 - 18:00 |
| NIY | Yen Denominated Nikkei 225 Index | SGXCME | Mon - Fri 18:30 - 01:30 |
| NKD | USD Denominated Nikkei 225 Index | CME | Mon-Fri 03:00 - 16:15; 16:30 - 17:30 & 18:00 - 19:00 |
| NKD | USD Denominated Nikkei 225 Index | SGXCME | Mon - Fri 02:15 - 09:55 & 18:30 - 01:30 |
*Please refer to the respective websites of each exchange for adjustments which take place during periods when US Daylight Savings Time is in effect.