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THE CHICAGO MERCANTILE EXCHANGE

The Chicago Mercantile Exchange is one of the world's premiere futures and options exchanges, offering a diverse range of financial products for institutional and retail investors. Throughout its nearly 100-year history, the CME has maintained a firm commitment to providing the marketplace with risk management tools to capitalize on opportunities in domestic and international financial markets. The most recent example of this is the CME's emerging markets initiative, which resulted in the development of the Growth and Emerging Markets (GEM) division.

Over the last decade, the investment flow from the industrialized countries to the emerging markets has significantly increased. While this has created a wide range of opportunity, there is a reasonable degree of risk associated with emerging market investments and foreign exchange transactions. Until now, there have been few exchange-listed products available to help manage that risk. Therefore, the CME created the GEM division making it the leading exchange for emerging market risk management in currency, interest rate and equity sectors.

The CME's Mexican peso futures contract, launched in April 1995 was the first emerging markets product to be traded on the Exchange. In a year of trading, the peso contract has become the fastest growing currency product ever traded at the CME. In May 1995, average daily volume in peso futures topped 3,200 contracts!

Last November, the CME launched futures and options on the Brazilian real. Unlike the peso, trading activity is concentrated in the options. Currently, options open interest is close to 30,000 contracts.

The first interest rate products to be offered in the GEM division are Brady bonds on four of the most active Brady issues: Argentine FRB bonds, Brazilian C bonds, Brazilian EI bonds and Mexican par bonds. These contracts began trading in March 1996. Recently, the contract size was doubled from $50,000 to $100,000 starting with the Sep 96 expiration. In addition, the minimum tick increment was decreased from .05 worth $25 per tick to .01 worth $10 per tick. These enhancements were made to further facilitate the efficient trading of the markets.

To round out the offerings on Mexican financial markets, the CME introduced futures and options on the Mexican IPC, the benchmark Mexican stock market index, analogous to the S&P 500. This index is capitalization weighted and comprised of the top 35 stocks traded on the Bolsa Mexicana de Valores (BMV).

The products listed above-- currencies, stock indices and interest rates from emerging market countries--form the core of the GEM division. For details about the GEM division, its products, and other emerging market information, please visit the CME's Web site at http://www.cme.com.