CME and Merrill Lynch Launch PIMCO SPTR TRAKRS

In a special opening procedure concluded on Wednesday, Nov. 1, nearly 1.85 million contracts representing more than $46 million in value were traded. The PIMCO SPTR TRAKRS start their regular trading schedule today and will trade Monday -- Friday from 8:30 a.m. to 3:00 p.m. Chicago time on CME Globex®.

PIMCO StocksPLUS Total Return TRAKRS are non-traditional futures contracts that seek to outperform the Standard & Poor's 500 Index® by combining passive equity index exposure with exposure to an actively managed total return fixed-income portfolio.

TRAKRS, or Total Return Asset Contracts, are designed to enable investors to track an index of stocks, bonds, currencies, commodities or other financial instruments. Outstanding TRAKRS offerings include Long-Short Technology TRAKRS II, Gold TRAKRS, Rogers International Commodity Index TRAKRS, LMC II TRAKRS, BXY TRAKRS and PIMCO Commodity RealReturn DJ-AIG TRAKRS. TRAKRS are the first broad-based index products traded on a U.S. futures exchange that can be sold by securities brokers. Furthermore, when purchased by non-institutional customers and certain "electing institutional customers," they are the first futures contracts that can be held in securities accounts. Each TRAKRS contract, for which CME receives significantly lower than usual clearing fees, has a notional value of approximately $25 at launch.

TRAKRS differ from traditional futures contracts in that they are not leveraged for most long non-institutional customers and electing institutional customers, who are required to post 100 percent of the TRAKRS market value at the time of purchase. As a result, non-institutional customers and electing institutional customers establishing long TRAKRS positions will not be subject to margin calls or any requirement to make any additional payments throughout the life of their TRAKRS positions. Non-institutional customers and electing institutional customers establishing short TRAKRS positions post 50 percent of the price. Short positions held by non-institutional customers and electing institutional customers are subject to certain maintenance payments if the settlement price increases substantially. Alternatively, if the settlement price decreases significantly, non-institutional customers and electing institutional customers will receive a maintenance payment. Securities brokers, subject to notice registering with the National Futures Association, are able to solicit trades in TRAKRS from non-institutional customers and electing institutional customers.

For more information on this product, please visit:
http://www.cme.com/trading/prd/overview_P318343.html