CBOT membership price

[nazzdack]

----When does the B2 associate membership bottom?

1) Possibly towards the end of Summer if trade is slow combined with an absence of new traders.
2) A little more likely during December when there can be "tax selling" and an absence of new traders who want to start trading that time of the year.
3) If the Fed begins a tightening cycle in June, it ought to be very bullish for the "A.M." seats/badges.

 

[TraDaToR]

Now with CME closing pits, I think membership will lose value...And I am trading more CME products than CBOT lately...What do you think?

 

[TraDaToR]

Bid @ 255K...Not mine, just checking.

 

[TraDaToR]

http://www.reuters.com/article/2015/02/07/cme-group-closure-meeting-idUSL1N0VH02E20150207

"The value of seats should only decline by about 1 percent when pits ultimately close because they account for less than 1 percent of exchange trading volumes, executives said, according to attendees, who have seen seat values fall sharply this week."

What???

 

[TraDaToR]

http://www.ft.com/intl/cms/s/0/eb60...44feab7de.html?siteedition=intl#axzz3RDwxFG4V

 

[TraDaToR]

http://www.reuters.com/article/2015/02/06/cme-group-closure-duffy-idUSL1N0VF2F720150206

 

[TraDaToR]

I put my membership purchase on standby.

Do you think:

- It is possible CME Group will introduce new memberships like some are asking?
- The old CBOT/CME memberships will remain?
- If they don't remain, will they buy it back at a higher price?

 

[xandman]

Members storming out of meetings. That's a bad sign. We probably have some members here who are keeping tight lipped.

- Possible. I think the electronic membership, which should have expired, is still in effect. http://www.cmegroup.com/company/membership/files/ECMQA.pdf
- I can't even guess.
- Buy back at a higher price? It's doesn't represent equity. I can't imagine that. The good old boy system was neutered when they went public. Shareholder interests take priority.

 

[xandman]

FYI - Advantage Futures has a consultant who specializes in evaluating membership and applications.

In the US, we have several things to consider when getting membership and getting a professional designation namely data fees and tax status.

 

[garachen]

I was able to scoop up several more seats on the last big sale. It appears that the sudden selling was more of a knee jerk reaction rather than old time floor traders liquidating. I have the numbers somewhere but there are not as many total seats as you might think. Who knows, maybe they'll do something like they did with the old ICE seats and make them very valuable but unsaleable. That wouldn't be the worst thing. There are several benefits to owning that might not be immediately apparent.

Plus, you can always take out a 50% LTV loan against them at a pretty reasonable rate. Or lease them out. Or pledge them. As long as you can project the fee reductions coving the cost in 2-3 years you are petty safe.