CMEGroup 

ACME/Chicago Board of Trade Company 

Mr. David Stawick 

Secretary 

Commodity Futures Trading Commission 

Three Lafayette Centre 

1155 21st Street, N.W. 

Washington, D.C. 20581 

February 13, 2008 

COMMENT 

Re: Proposed Revision of Federal Speculative Position Limits- 72 F.R. 65483 

(November 21, 2007) 

Dear Mr. Stawick: 

Craig S. Donohue 

Chief Executive Officer 

{/') 

~ CME Group, Inc. ("CME Group") filed a comment letter with respect to the Commodity Futures Trading 

Commission's ("Commission") proposed revision of federal speculative position limits on February 1, 

2008. This is a supplement to that letter. 

CME Group was formed by the July 2007 merger of Chicago Mercantile Exchange Holdings Inc. and 

CBOT Holdings, Inc. CME Group is the parent of Chicago Mercantile Exchange Inc. and the Board of 

Trade of the City of Chicago, Inc. ("CBOT"). CME Group also owns Swapstream Operating Services 

Limited, anOTC trading facility, and owns an interest in FXMarketspace Limited, an FX trading platform 

that is authorized and regulated by the United Kingdom's Financial Services Authority. CME Group 

serves the global risk management needs of our customers and those who rely on the price discovery 

provided by the competitive markets maintained by CME Group. CME Group offers a comprehensive 

selection of benchmark products in most major asset classes, including futures and options based on 

interest rates, equity indexes, foreign exchange, agricultural commodities, energy, and alternative 

investment products such as weather and real estate. Additionally, CME Group offers order routing, 

execution and clearing services to other exchanges by means of our Glob ex® electronic trading platform· 

and our clearing house. CME Group is traded on the New York Stock Exchange and NASDAQ under the 

symbol "CME." 

I. Overview 

The primary focus of the Commission's Federal Register release was its proposal to increase speculative 

position limits for certain agricultural commodities enumerated in Regulation 150.2. CME Group 

responded to the Commission's recommended increases by stating its position that the Commission 

should eliminate all federally-mandated position limits and repeal Regulation 150.2, and that even if the 

Commission determines not to eliminate federal spot month limits, it should remove single month and allmonths-combined limits from Regulation 150.2. Additionally, CME Group commented that if the 

Commission nevertheless retains federally-mandated single month and all-months-combined limits, the 

limits should be increased based on 2007 open interest data. CME Group believes that the Commission 

should proceed to take action with respect to this aspect of its Federal Register release. 

The Commission also proposed to adopt an aggregation requirement, by means of a new footnote. to the 

position limit chart in Regulation 150.2, which would: 

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Mr. David Stawick 

February 13, 2008 

Page 2 

... aggregate traders' positions for purposes of ascertaining compliance with Federal speculative 

position limits when a DCM lists for trading a futures contract that shares substantially identical 

terms with a Regulation 150.2-enumerated contract listed on another DCM, including a futures 

contract that is cash-settled based on the settlement prices for a futures contract that is already 

enumerated. 

Although CME Group commented on the Commission's aggregation proposal based on its understanding 

of the Federal Register release, upon further review, we believe that the Commission's description of its 

aggregation proposal leaves certain important questions unanswered. Because this makes it difficult to 

provide informed and thorough comments, CME Group requests that the Commission republish its 

aggregation proposal with the clarifications discussed below. However, such republication should not 

delay the Commission's consideration of position limit increases based on the CBOT's 2007 open interest 

data, if the Commission determines to retain federally-mandated speculative position limits. 

II. The Commission should clarify the following aggregation issues. 

Specifically, the Commission should consider and discuss the following issues in any republication of its 

aggregation proposal: 

• Is the Commission's aggregation proposal an extension of federally-mandated position limits to 

markets that are not currently enumerated in Regulation 150.2 when they offer "substantially 

identical contracts," even in the absence of an amendment to Regulation 150.2 to identify those 

DCMs and products by name? In other words, is the Commission suggesting that it would have 

the authority to charge a market participantwith a violation of Regulation 150.2, for exarnple, if 

the participant held no positions in the CBOT Corn contract in a single month, but held 14,000 

"substantially identical" Corn positions on another DCM in a single month? 1 

• The current single month and all-months-combined federal limits for the specified agricultural 

futures contracts are based on the application of the Commission's open interest formula, as 

described in Regulation 150.5, as applied to open interest data for those particular contracts on 

the identified DC Ms. If another DCM were to list a "substantially identical" contract, and were 

permitted to share the position limits based on the specified DCM's open interest, how would 

future increases in the Commission's position limits be determined? Would the Commission 

propose to raise an aggregated limit based on the combined open interest of the market 

enumerated in Regulation 150.2 and the other DCM, or would any proposed increase only be 

based on the open interest on the enumerated market? If the latter, wouldn't this formula fail to 

account for any increased overall open interest on both markets combined? 

• Regulation 150.5 provides guidance with respect to speculative position limit levels at designation 

for those products that are not subject to federally-mandated position limits. In particular, 

Regulation 150.5(b)(2) states that individual nonspot or all-months-combined levels should be no 

1 For purposes.of this example, we are assuming the applicability of the current position limit of 13,500 contracts in a 

single month for CBOT Corn contracts. 

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Mr. David Stawick 

February 13, 2008 

Page 3 

greater than 1 ,000 contracts for tangible commodities other than energy products. Although 

Regulation 150.5 is not strictly applicable to DCMs, pursuant to Regulation 38.2, the Commission 

has referred to Part 150 as a guideline in its Acceptable Practices for compliance with Core 

Principle 5 of Section 5(d) of the Commodity Exchange Act ("CEA") (Position Limitations or 

Accountability) in Appendix B to Part 38. Does the Commission intend to supersede this 

guideline with respect to new contracts listed on other DCMs that are "substantially identical" to 

those contracts listed in Regulation 150.2? By permitting another DCM to list such "substantially 

identical" agricultural contracts, and immediately allowing that market to have the same position 

limits as an established market that has significant open interest, wouldn't the Commission be 

drawing an unjustified distinction between such new agricultural products and other new tangible 

commodity products, including agricultural products that are not subject to Commission-imposed 

limits? With respect to a tangible commodity product that is not listed in Regulation 150.2, if the 

product is listed by one DCM that has substantial open interest, and a "substantially identical" 

contract is listed by another DCM, would the second DCM be in compliance with Core Principles 

if it simply adopted the same position limits as the first DCM for that product? Would the 

Commission have the same interest in aggregation with respect to "substantially identical" 

contracts that are not subject to federal position limits? 

We believe that the Commission should address these questions and republish a rule proposal that more 

fully describes how aggregation would work. By doing so, the Commission would give market 

participants and the public the ability to provide more meaningful comments. 

We would be happy to discuss any of these issues with Commission staff. Please feel free to contact me 

at (312) 930-8275 or Craig.Donohue@cmegroup.com; Richard Lamm, Managing Director, Regulatory 

Counsel, at (312) 930-2041 or Richard.Lamm@cmeqroup.com; or Anne Polaski, Associate Director and 

Regulatory Counsel, at 312-338-2679 or Anne.Polaski@cmegroup.com. Thank you for your 

consideration. 

CSD/cf/7206.1tr 

cc: Acting Chairman Walter Lukken 

Commissioner Bart Chilton 

Commissioner Michael Dunn 

Commissioner Jill E. Sommers 

Don Heitman 

Martin Murray 

Richard Shilts 

David Van Wagner 

Craig S. Donohue