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The Eurodollar futures contract was launched in 1981. It was the first cash-settled futures contract. [13] It traded on the Chicago Mercantile Exchange. [14] Eurodollar futures were an instrument used to wager on Federal Reserve policy or to hedge the direction of short-term interest rates.
TED is an acronym formed from T-Bill and ED, the ticker symbol for the Eurodollar futures contract. Initially, the TED spread was the difference between the interest rates for three-month U.S. Treasuries contracts and the three-month Eurodollars contract as represented by the London Interbank Offered Rate (LIBOR).
The Euro Interbank Offered Rate (Euribor) is a daily reference rate, published by the European Money Markets Institute, [1] based on the averaged interest rates at which Eurozone banks borrow unsecured funds from counterparties in the euro wholesale money market (or interbank market). Prior to 2015, the rate was published by the European ...
The London Interbank Offered Rate (LIBOR) came into widespread use in the 1970s as a reference interest rate for transactions in offshore Eurodollar markets. [25] [26] [27] In 1984, it became apparent that an increasing number of banks were trading actively in a variety of relatively new market instruments, notably interest rate swaps, foreign currency options and forward rate agreements.
A short-term interest rate (STIR) future is a futures contract that derives its value from the interest rate at maturation. Common short-term interest rate futures are Eurodollar, Euribor, Euroyen, Short Sterling and Euroswiss, which are calculated on LIBOR at settlement, with the exception of Euribor which is based on Euribor and Euroyen which is based on TIBOR.
The European currency hit its all-time high of $1.18 shortly after its launch on Jan. 1, 1999, but then began a long slide, falling through the $1 mark in February 2000 and hitting a record low of ...
The International Monetary Market (IMM), a related exchange created within the old Chicago Mercantile Exchange and largely the creation of Leo Melamed, was one of four divisions of the CME Group (CME), the largest futures exchange in the United States, for the trading of futures contracts and options on futures.
Best CD rates today: Rates are ticking down, yet you can still lock in 5.10% on terms of 6+ months — Sept. 11, 2024 Kelly Suzan Waggoner Updated September 11, 2024 at 5:08 AM