A Resource for Alternative Investments and Trading
The global carbon market exchange may reach $700 Billion by the year 2013, click here to learn more.
Chicago Climate Exchange (CCX) is North America's only cap and trade system for all six greenhouse gases, with global affiliates and projects worldwide.
CFI Contracts, the CCX Tradable Commodity
The commodity traded on CCX is the CFI contract, each of which represents 100 metric tons of CO2 equivalent. CFI contracts are comprised of Exchange Allowances and Exchange Offsets. Exchange Allowances are issued to emitting Members in accordance with their emission baseline and the CCX Emission Reduction Schedule. Exchange Offsets are generated by qualifying offset projects.
Global Affiliates
Chicago Climate Futures Exchange (CCFE) is a landmark derivatives exchange that currently offers standardized and cleared futures and options contracts on emission allowances and other environmental products. CCFE is a wholly owned subsidiary of CCX.
(Visit CCFE's website)
- The first tool for directly hedging exposure under a potential mandatory U.S. greenhouse gas trading program.
To trade CCFE products, interested parties must establish an account with one of the below registered CCFE clearing firms.
ADM Investor Services Inc.
Banc of America Securities
Barclays Capital Inc.
BNP Paribas Commodity Futures Inc.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Deutsche Bank Securities Inc.
Fortis Clearing Americas LLC
Goldman Sachs & Co.
| J.P. Morgan Futures Inc.
MF Global Inc.
Merrill Lynch, Pierce, Fenner & Smith, Inc.
Mizuho Securities USA Inc.
Newedge USA LLC
Prudential Bache Commodities LLC
RBC Capital Markets Corporation
R.J. O'Brien and Associates, LLC
Tradelink LLC (self-clearing only)
UBS Securities LLC |
IFEX Event Linked Futures (ELFs)
IFEX Event Linked Futures (ELFs) are futures market versions of 'Industry Loss Warranties' (ILWs). ILWs are reinsurance contracts triggered by pre-determined losses to the insurance industry in excess of specified amounts and by specified losses to the insurers and reinsurers which have bought the coverage. ILWs are usually ‘binary’ or ‘digital’ contracts with the payment triggered in full once loses have reached the pre-specified amounts. IFEX ELFs are binary futures contracts and have the same structure.
IFEX ELFs are contracts for difference and NOT reinsurance contracts. IFEX ELFs have similar economic characteristics to ILW reinsurance policies except that buyers of the contracts do not have to suffer losses to receive a payment once the industry loss strike amount has been reached. In other words ELFs do not have 'Ultimate Net Loss' clauses.
IFEX ELFs have been designed to replicate the structure of ILW reinsurance contracts as contracts for differnce in tradable form. Uses will include:
- Hedging of cat bond and ‘cash market’ ILW portfolios.
- Hedging catastrphe exposed equities – insurers and reinsurers.
- Using future year contracts (2009) to hedge cat insurance price risk – hedging the price of renewals both as writer and buyer.
- Increasing or decreasing exposure to US Tropical Wind.
- As supplements to inwards and outwards reinsurance programmes.
- Exploitation of mis-pricing compared to technical rates.
FXIBonline is not affiliated with any of the exchanges above