CME was ill-prepared for negative oil prices, FCMs say

Bourse draws criticism over timing of options model change; delay in sending key margin file

cme

CME Group is taking flak over its decision to change the model it uses to price oil options during a period of unprecedented volatility in crude markets.

Four of CME’s largest clearing members have criticised the timing of the model switch, with some suggesting that a delay in receiving accompanying margin instructions from the central counterparty exposed them to undue risk.

“Why were they not better prepared for it?” asks a source at a large futures commission merchant (FCM). “It’s not like

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