What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2022-02-25 compared with 2021-02-26 · 148 added, 153 removed, 272 unchanged (53% of the section changed)

CME Group provides market participants worldwide the ability to efficiently manage risk across multiple asset classes, by trading futures, options, cash and over-the-counter (OTC) products.

CME Group also offers a suite of products and services to optimize portfolios, achieve capital efficiencies and manage pre-trade and post-trade processes.

Our customers can receive and analyze market data through multiple service offerings in real-time, historical and derived data formats.

CME Group provides market participants worldwide the ability to efficiently manage risk within and across multiple asset classes, by trading futures, options, cash and over-the-counter (OTC) products.

CME Group provides primary price discovery and referential pricing information through its market data in a variety of formats, including real time, historical and derived data for customers in both listed and cash products.

CME Group also offers industry-leading research and analytics tools to provide customers with market education resources.

1 unchanged sentence

CME was founded in 1898 as a not-for-profit corporation.

It established CME Clearing in 1919, which is operated by CME.

It established CME Clearing in 1919, which is operated as part of CME.

CME demutualized in 2000, and in 2002 its parent company, CME Group, completed an initial public offering of its Class A common stock (Nasdaq:

9 unchanged sentences

In addition, we operate one of the world’s leading central counterparty clearing providers, CME Clearing, operated by CME.

With a range of pre- and post-trade products and services underpinning the entire lifecycle of a trade, CME Group offers optimization, reconciliation and processing services through Traiana, TriOptima and Reset.

Derivatives Exchange Business:

2 unchanged sentences

Our products provide a means for hedging, speculation and asset allocation related to the risks associated with, among other things, interest rate sensitive instruments, equity ownership, changes in the value of foreign currency and changes in the prices of agricultural, energy and metal commodities.

• CME's product slate includes agricultural, equities, FX and interest rate products, including Eurodollar futures and options, Secured Overnight Financing Rate (SOFR) futures and options, livestock and cash-settled contracts based on the S&P 500, including the E-mini S&P 500 Environmental, Social and Governance (ESG) contract, Micro E-mini Equity Index contracts, Nasdaq-100, FTSE Russell and Bitcoin Reference Rate.

• CME's product slate includes agricultural, equities, FX, cryptocurrencies/alternative investments and interest rate products, including Eurodollar futures and options, Secured Overnight Financing Rate (SOFR) futures and options, Bloomberg Short-Term Bank Yield (BSBY), livestock and cash-settled contracts based on the S&P 500, including the E-mini S&P 500 ESG (Environmental, Social and Governance) contract, Micro E-mini Equity Index contracts, Nasdaq-100, FTSE Russell and Bitcoin and Ether Reference Rate.

• CBOT's product slate consists of agricultural, equities and interest rate products, including contracts for United States (U.S.) Treasury futures, soybean, corn, wheat and contracts based on the Dow Jones Industrial Index.

• NYMEX's product slate consists of energy and metals products, including contracts for crude oil, natural gas, heating oil and gasoline.

• NYMEX's product slate consists of energy and metals products, including contracts for crude oil, natural gas, heating oil, gasoline and emissions contracts (GEO and NGO).

• COMEX's product slate consists of metals products, including contracts for gold, silver, copper and other base metals.

1 unchanged sentence

Our asset classes contain products designed to address differing risk management needs, and customers are able to manage risks and achieve operational and capital efficiencies by accessing our diverse products through our platforms and our clearing house.

CME Group products are traded primarily through CME Globex, as well as by open outcry auction markets in Chicago and through privately negotiated transactions.

CME Group products are traded primarily through CME Globex, as well as by open outcry in Chicago for Eurodollar options and SOFR options and through privately negotiated transactions.

Due to the COVID-19 pandemic, in March 2020 we closed our open outcry trading floor and reopened it in August 2020 for Eurodollar options.

Currently, the remainder of the trading floor is closed.

We strive to provide the most flexible and scalable platforms to support the operational and capacity needs of the business along with the delivery of innovative technology solutions to the marketplace.

In May 2021, we announced our decision to permanently close the trading floor outside of Eurodollar options and SOFR options.

We strive to provide the most flexible and scalable platforms to support the operational and capacity needs of our business along with the delivery of innovative technology solutions to the marketplace.

Our CME Globex electronic platform is the trading engine for our central limit order book markets and is available on a global basis nearly 24 hours a day throughout the trading week.

The CME Globex platform is accessible through a wide variety of vendor-provided and custom-built trading systems that benefit from our open application programming interface approach.

For privately negotiated markets, we offer brokers and customers the CME Direct platform for arranging, executing, recording and risk-managing trades.

includes CME One for mobile access and CME Straight-Through Processing, which enables direct connectivity for trade information directly with customer order management and risk management systems and is designed to reduce errors and improve efficiency.

For electronic and privately negotiated

markets, we offer brokers and customers the CME Direct platform for arranging, executing, recording and risk-managing trades across all six major asset classes.

We also provide the functionality to connect to CME Direct on a mobile device through our CME Direct Mobile application with full trading and on-the-go order management capabilities.

Together, our platforms offer:

18 unchanged sentences

CME Clearing Business:

Through our clearing house, CME Clearing, which is operated by CME, we provide clearing and settlement services for a broad range of exchange-traded futures and options on futures contracts and over-the-counter derivatives.

Our integrated clearing function is designed to ensure the safety and the soundness of our markets by serving as the counterparty to every trade, becoming the buyer to each seller and the seller to each buyer, and limiting counterparty credit risk.

2 unchanged sentences

The CME ClearPort front-end system provides access to our flexible clearing services for block transactions, bi-lateral trades and swaps.

In 2021, we launched the derivatives industry’s first Sustainable Clearing service to help market participants track and report how their hedging activities are advancing their sustainability goals.

The majority of clearing and transaction fees received from clearing firms represents charges for trades executed and cleared on behalf of their customers.

5 unchanged sentences

BrokerTec and EBS offer anonymous and disclosed trading venues, offering clients multiple execution and distribution options and the benefit of an established and far-reaching distribution network of liquidity providers and consumers.

Our BrokerTec markets were migrated from a third-party platform to our CME Globex electronic platform in the first quarter of 2021 and our EBS market is expected to migrate to the CME Globex platform in the fourth quarter of 2021.

• BrokerTec operates global electronic trading for fixed income products on the CME Globex platform, with a leading position in cash U.S.

2 unchanged sentences

It facilitates trading principally for banks and non-bank professional trading firms.

• EBS is a global electronic platform for the trading of FX products across major and emerging market currencies.EBS also offers execution of non-deliverable forwards through a Commodity Futures Trading Commission (CFTC) registered Swap Execution Facility (SEF).

Optimization Business:

Our optimization services, which include Traiana, TriOptima and Reset, deliver transaction lifecycle management services to help our clients simplify their workflow, optimize their capital and resources, mitigate their risk, increase efficiency, reduce their operational costs and streamline complex processes.

• Trade and portfolio management comprises portfolio and margin reconciliation, monitoring pre-trade risk and automating post-trade processing of financial transactions.

• Financial resource optimization comprises portfolio compression, basis risk mitigation, portfolio balancing and derivative pricing and risk analytics.

• Regulatory reporting comprises trade and position reporting (including licensed MiFID agent reporting to national regulators and the public), end-to-end multi-regime regulatory reporting, data normalization, enrichment, reconciliation, validation and cross-jurisdictional matching.

In 2020, we substantially completed the wind-down of our commercial regulatory reporting operations.

We have transitioned to self-reporting for our EMEA BrokerTec and EBS businesses and will also continue to serve customer reporting needs in the U.S.

(CFTC reporting) and Canada.

• Trade Processing comprises end-to-end automation, from trade execution notification to trade confirmation of post-trade processing, in real-time to reduce operational risks and costs.

In January 2021, we announced an agreement with IHS Markit to combine our post-trade services into a new joint venture.

The new company will be structured as a 50/50 joint venture and will include trade processing and risk mitigation operations through incorporation of our optimization businesses – Traiana, TriOptima and Reset – and IHS Markit’s MarkitSERV.

We expect the transaction to close in mid-2021, subject to customary antitrust and regulatory approvals and other customary closing conditions.

• EBS is a global electronic platform for the trading of FX products across major and emerging market currencies.

EBS also offers execution of non-deliverable forwards through a Commodity Futures Trading Commission (CFTC) registered swap execution facility (SEF).

EBS operates both as a Central Limit Order Book platform (EBS Market) for

spot and non-deliverable forwards currency pairs, as well as a relationship-based trading platform offering spot FX, FX forwards and FX swaps (EBS Direct).

Market Data Business:

2 unchanged sentences

We further offer derived cash markets pricing, third-party and alternative data sets, as well as a wide range of analytic tools.

As customers continue to leverage cloud technology to improve and evolve their businesses, CME Group has taken a leading role by becoming the first derivatives marketplace to provide live market data natively in the cloud with the launch of our Smart Stream on Google Cloud Platform capabilities.

CME Group is also the distributor of leading benchmark equity and commodity indices on behalf of third parties as well as our own proprietary indices, which include CME Group Volatility Indices (CVOL).

As customers continue to leverage cloud technology to improve and evolve their businesses, CME Group has taken a leading role by becoming the first derivatives marketplace to provide live market data natively in the cloud with the launch of our cloud connect capabilities on Google Cloud Platform.

CME Group is also the distributor of leading benchmark equity and commodity indices on behalf of third parties as well as our own proprietary benchmarks and indices.

Our Strategic Initiatives

3 unchanged sentences

We have further focused on building upon cloud-based data distribution capabilities as a more flexible and potentially cost-effective means of providing data to our clients.

In 2020, CME Group futures and options had an average daily volume of 19.1 million contracts, with volume records in two of our asset classes - equities and metals for the fifth consecutive year.

It was also a year of volume records for multiple products, including:

Ultra 10 Year futures, SOFR futures, E-mini Nasdaq-100 futures, Russell 2000 futures, Micro E-Mini Equity Index futures and a record number of contracts executed via Basis Trade at Index Close.

We set records in the volume traded for our Micro E-Mini Equity Index futures in total, as well as for each of the Micro E-Mini S&P 500, Nasdaq-100, Russell 2000 and Dow 30 contracts.

We also set an overall volume record for the Natural Gas franchise, as well as an individual product record in Silver futures.

In 2021, CME Group futures and options had an average daily volume of 19.6 million contracts, with a volume record in our equity asset class for the sixth consecutive year.

It was also a year of volume records for multiple products, including Ultra 10 Year futures, SOFR futures, Bitcoin futures, Micro E-Mini Equity Index futures and a record number of contracts executed via Basis Trade at Index Close.

We set records in the volume traded for our Micro E-Mini Equity Index futures in total, as well as for each of the Micro E-Mini Nasdaq-100, Russell 2000 and Dow 30 contracts.

We continue to expand and deepen our customer base worldwide and offer customers around the world the most broad and diversified portfolio of benchmark products.

2 unchanged sentences

• Adjusted Interest Rate (AIR) Total Return Futures (2020)

• Trade at Cash Open (TACO) (2019)

• Cash-settled Bitcoin Options (2020)

• SOFR Options (2020) and SOFR OTC Swaps (2019)

• Shanghai Gold Futures (2019)

• Physical Liquefied Natural Gas (LNG) Futures (2019)

• Micro E-mini Equity Index Futures (2019) and Options (2020)

• E-mini S&P 500 ESG Index Futures (2019)

• SOFR Options (2020)

• Micro E-mini Equity Index Options (2020)

• Brazilian Soybean Futures (2020)

4 unchanged sentences

• Adjusted Interest Rate Total Return Futures (2020)

In addition to the individual product launches noted above, we have completed many product extensions across our asset classes, including short-dated options products, monthly FX futures, additional grades in our crude oil complex and expansion of our metals complex with additional base metals products.

• E-mini Nasdaq 100 Weekly Options (2021)

• E-mini Russell 2000 Weekly Options (2021)

• Micro Bitcoin Futures (2021)

• Ether and Micro Ether Futures (2021)

• Micro Treasury Yield Futures (2021)

• Micro WTI Futures (2021)

• Global Emissions Offset (GEO) and Nature-based Global Emissions Offset (N-GEO) Futures (2021)

In addition to the individual product launches noted above, we have completed many product extensions across our asset classes, including short-dated options products (Monday and Wednesday weekly options on the E-Mini Nasdaq 100 and Russell 2000), expanded Japanese energy futures (including four new Japanese electricity futures contracts and two new LNG futures contracts), and additional implied volatility products in fixed income, energy, metals and agricultural products to our suite of CME Group Volatility Indexes (CVOL).

We continue to expand and deepen our customer base worldwide and offer customers around the world with the most broad and diversified portfolio of benchmark products.

2 unchanged sentences

Our penetration of these markets lags our development in the U.S., and we believe that there is room for significant growth and development of these financial markets.

In 2020, approximately 28% of our electronic futures and options volume was from transactions reported as outside the U.S.

In 2021, approximately 29% of our electronic

futures and options volume was from transactions reported as outside the U.S.

and approximately 56% of our market data revenue was derived from outside the U.S.

We also achieved 5% growth in trading volume during Asian trading hours and 3% growth during European trading hours in 2021 compared to 2020.

In 2020, we launched four proprietary tools to enable customers to link and compare opportunities across OTC, cash and futures markets:

FX Swap Rate Monitor, FX Options Vol Converter, TreasuryWatch Tool and FX Market Profile Tool.

Our CME Liquidity Tool enables market participants to analyze liquidity across CME Group products during U.S., London or Singapore trading hours.

To further our commitment to our international customers, in 2020 we introduced a TreasuryWatch Tool and additional tools to help customers and prospective customers identify key marketplace developments and potential risk management and trading opportunities (e.g., SOFR-LIBOR spread).

Also in 2020, we began daily publication of a suite of new implied volatility benchmark indexes based on our innovative and proprietary CME Group Volatility Index (CVOL) methodology, starting with 10-Year Treasuries and FX currency pairs.

We have increased our customer base and continue to target cross-asset sales across client segments, driving international sales and generating new client participation across all regions.

We have a long history of providing customer value and responsiveness and believe our products and services position us to help our customers adapt and comply with new regulations, while enabling them to efficiently manage their risks.

CME Group is also the distributor of leading benchmark equity and commodity indices on behalf of third parties, as well as our own proprietary benchmarks and indices including CME Term SOFR.

In 2021, we updated the FX Market Profile Tool and launched a Metals Market Profile and, in 2022, we launched an UST Market Profile.

The FX and Metals Market Profile Tool on Quant Analytics offers a simple but effective method for clients to compare and contrast our leading FX and metals products and liquidity pools side-by-side, which in turn enables clients to analyze their opportunity to minimize costs and achieve best execution by accessing highly complementary liquidity pools across cash and futures markets.

We expect to continue to expand this Quant Analytics suite in the future as well.

Our CME Liquidity Tool enables market participants to analyze liquidity across CME Group products during U.S., London or Singapore trading hours and was expanded to 37 products in 2021 to meet customer demand for our growing product suite.

To further our commitment to our global customers, in 2020, we introduced a TreasuryWatch Tool and additional tools to help customers and prospective customers identify key marketplace developments and potential risk management and trading opportunities (e.g., SOFR-LIBOR spread).

In 2021, we extended our new CVOL family with two additional releases for a total of 40 indexes, including six unique broad-based benchmarks such as the Treasury Volatility Index and Commodity Volatility Index.

We also introduced an initiative to launch real-time streaming versions of the CVOL indexes, which is expected to occur in 2022.

We have increased our customer base and continue to target cross-asset sales across client segments, driving global sales and generating new client participation across all regions.

We have a long history of providing customer value and responsiveness and believe our products and services position us to help our customers adapt to and comply with new regulations, while enabling them to efficiently manage their risks.

We have a broad distribution network comprised of a combination of internal and external channels and proprietary front-end capabilities.

Diversify our Business and Revenue - Our acquisition of NEX strengthened our role in global financial markets infrastructure and information services, adding complementary cash and OTC businesses and scale to our listed interest rate and FX products, while enabling new efficiencies for the derivatives marketplace.

We are positioned to take direct advantage of growth in treasury issuance, liquid treasury holdings and the trading of treasury instruments, as well as growing repo activity in the U.S.

The transaction expanded CME Group’s position in the large, highly competitive and highly fragmented global FX marketplace, offering both order book trading and relationship-based trading solutions for customers.

The acquisition added strength in underlying customer marketplaces, especially around regional bank customers and other market participants outside of North America and expanded our post-trade and trade-processing services and market data solutions beyond futures and options into cash and OTC offerings.

The acquisition added strength in underlying customer marketplaces, especially around regional bank customers and other market participants outside of North America, and expanded our market data solutions beyond futures and options into cash and OTC offerings.

During 2021, the Alternative Reference Rates Committee (ARRC) formally recommended the forward-looking term rates based on SOFR published by our subsidiary, CME Group Benchmark Administration Limited.

The ARRC formalized this recommendation in July 2021.

We are working closely with our customers during this transition, and we will continue to offer capital-efficient choices to manage risk via Eurodollar, 30-Day Federal Fund, SOFR and SONIA futures, as well as SOFR- and SONIA-based cleared OTC swaps.

We are also licensing the CME Term SOFR rate to third parties.

Our joint venture with S&P Global, Inc., S&P/DJI Indices LLC, combines the world class capabilities of the S&P and Dow Jones Indices, and is a significant player in passive investing, including the exchange-traded fund (ETF) industry value chain.

1 unchanged sentence

We also act as the joint ventures' licensing agent and distribution services provider.

In September 2021, we completed the establishment of OSTTRA, a 50/50 joint venture with IHS Markit that combines our post-trade services business (Traiana, TriOptima and Reset) and IHS Markit’s MarkitSERV, and serves as a leading provider of progressive post-trade solutions for the global OTC markets across interest rate, FX, equity and credit asset classes.

In connection with the establishment of OSTTRA, we contributed the net assets of our post-trade services business to the joint venture in exchange for cash and a 50% equity interest in the company.

Deliver Unparalleled Customer Efficiencies and Operational Excellence - With changing regulatory capital requirements for many of our customers, including additional margin requirements on uncleared trades, and the need for greater efficiencies, we have added tools to enable customers to manage trading and clearing positions in our markets in an efficient manner.

2 unchanged sentences

We provide a comprehensive multi-asset class clearing solution to market participants for maximum operational ease and the capital efficiency that comes with connecting to our clearing house.

Our clearing services offer the ability to optimize collateral and capital efficiencies across portfolios within the clearing house while meeting the heightened regulatory requirements on derivatives.

Our clearing services offer the ability to optimize collateral

and capital efficiencies across portfolios within the clearing house while meeting the heightened regulatory requirements on derivatives.

The majority of our clearing volumes and activities are related to our listed futures and options, which represents the majority of our open interest and collateral held against these positions.

We also offer clearing services for OTC interest rate swaps, FX forwards and commodity swaps.

The addition of our enhanced Standard Portfolio Analysis of Risk (SPAN) margin framework – CME SPAN 2, will provide enhanced risk management capabilities in a single, unified interface by maintaining

SPAN's current calculations and functions while incorporating several new modeling, reporting and margin replication enhancements.

CME SPAN 2 will be launched in a phased multi-year approach, starting in 2021 with certain futures and options on energy products.

Over the next few years, as SPAN 2 is expanded to other asset classes, margins for diversified portfolios will consist of products using the enhanced CME SPAN 2 framework in addition to the existing SPAN framework, ensuring appropriate levels of offsets will continue to be provided across products subject to the SPAN and SPAN 2 frameworks.

The addition of our enhanced Standard Portfolio Analysis of Risk (SPAN) margin framework, CME SPAN 2, will provide enhanced risk management capabilities in a single, unified interface by maintaining SPAN's current calculations and functions while incorporating several new modeling, reporting and margin replication enhancements.

CME SPAN 2 will initially be launched with certain futures and options on energy products and then expanded to other asset classes.

As CME SPAN 2 is implemented, margins for diversified portfolios will consist of products using the enhanced CME SPAN 2 framework in addition to the existing SPAN framework, ensuring appropriate levels of offsets will continue to be provided across products subject to the SPAN and SPAN 2 frameworks.

CME Group provides various tools and services to assist customers with capital and operational efficiencies, including:

• CME Clearing provides compression via coupon blending as well as CME CORE, an interactive margin calculator that enables clients to optimize their capital by providing insights on margin requirements prior to trading.

• triReduce provides multilateral portfolio compression, which reduces notional outstanding exposure and line items in order to reduce operational resources and risks, minimize regulatory capital costs, and manage counterparty exposures.

• triResolve provides the global trading community with tools for portfolio reconciliation and collateral management, including compliance with initial margin and uncleared margin rules (UMR).

• Traiana provides various operational efficiencies and risk mitigation solutions to clients through bilateral and tri-party pre- and post-trade processing and credit risk management.

• Reset provides risk mitigation services to clients looking to hedge short-term interest rate and options expiry exposure.

• Under our newly announced agreement with IHS Markit, the joint venture will incorporate our optimization businesses – Traiana, TriOptima and Reset – and IHS Markit’s MarkitSERV.

We expect the transaction to close in mid-2021, subject to customary antitrust and regulatory approvals and other customary closing conditions.

• Portfolio margining allows firms to capitalize on margin offsets between futures, options and cleared OTC instruments with common risk factors.

• Cross-margining allows firms to achieve portfolio margin efficiencies for offsetting positions between two clearing houses, including CME and Fixed Income Clearing Corporation (FICC) or CME and Options Clearing Corporation (OCC), through reduced performance bond requirements.

Partnership with Google Cloud - In November 2021, we announced a 10-year strategic partnership with Google Cloud to accelerate CME Group’s move to the cloud, which we expect will transform derivatives markets by expanding access and creating efficiencies for market participants.

The partnership will focus on expanding access to CME Group’s infrastructure, advancing real-time data and analytics capabilities, co-innovating new products and services, increasing efficiencies and driving resiliency in the financial markets’ ecosystem.

Patents, Trademarks and Licenses

5 unchanged sentences

We also own copyrights to a variety of materials.

Those copyrights, some of which are registered, include printed and on-line publications, websites, advertisements, educational materials, graphic presentations and other literature, both textual and electronic.

Those copyrights, some of which are registered, include printed and online publications, websites, advertisements, educational materials, graphic presentations and other literature, both textual and electronic.

We protect our intellectual property rights by relying on trademarks, patents, copyrights, database rights, trade secrets, restrictions on disclosure and other methods.

We offer equity index futures and options on key benchmarks, including S&P, Nasdaq, Dow Jones and the FTSE Russell indexes.

We offer equity index futures and options on key benchmarks, including S&P, Nasdaq, Dow Jones, FTSE Russell and fixed income index futures on the Bloomberg Short-Term Bank Yield (BSBY) indexes.

These products are listed by us subject to license agreements with the applicable owners of the indexes, some of which are exclusive.

2 unchanged sentences

The license for the other S&P stock indexes is generally exclusive for futures and options.

The term of the S&P License Agreement will continue until the date that is one year after the date that CME Group ceases to own at least five percent (accounting for dilution) of the outstanding joint venture interests.

The term of the S&P License Agreement will continue until the date that is one year after the date that CME Group ceases to own at least 5% (accounting for dilution) of the outstanding joint venture interests.

Upon the occurrence of certain events, including certain terminations of the joint venture, the term may be extended up to an additional ten years.

1 unchanged sentence

The initial term of the agreement is through June 30, 2026.

Following the initial term, the Dow Jones License Agreement shall automatically renew for renewal terms of five years thereafter so long as there is open interest in any of CBOT’s or its affiliates’ products based on one or more of the Dow Jones licensed indexes.

Following the initial term, the Dow Jones License Agreement will automatically renew for renewal terms of five years thereafter, so long as there is open interest in any of CBOT’s or its affiliates’ products based on one or more of the Dow Jones licensed indexes.

In the event there is no open interest in any such products, then CME Indexes may terminate the agreement.

6 unchanged sentences

In addition, we cannot guarantee that others will not succeed in creating stock index futures based on information similar to that which we have obtained by license, or that market participants will not increasingly use other instruments, including securities and options based on the S&P, Dow Jones, Nasdaq or FTSE Russell indexes, to manage or speculate on U.S.

Parties also may succeed in offering indexed products that

are similar to our licensed products without being required to obtain a license, or in countries that are beyond our and/or our licensors' jurisdictional reach.

The industry in which we operate is highly competitive, has seen multiple new entrants over time, and we expect competition to continue to intensify and become more global, especially in light of changes in the financial services industry driven by regulatory reforms such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), European Market Infrastructure Regulation (EMIR), EMIR 2.2, Markets in Financial Instruments Directive II (MiFID II), Capital Requirements Directive IV, Market Abuse Regulation, Benchmarks Regulation, Basel III, and various other laws and regulations.

Please also refer to the discussion below and in the “Risk Factors” section beginning on page 15 for a description of competitive risks and uncertainties.

Parties also may succeed in offering indexed products that are similar to our licensed products without being required to obtain a license, or in countries that are beyond our and/or our licensors' jurisdictional reach.

The industry in which we operate is highly competitive and has seen multiple new entrants over time, and we expect competition to continue to intensify and become more global, especially in light of changes in the financial services industry driven by regulatory reforms such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), European Market Infrastructure Regulation (EMIR), EMIR 2.2, Markets in Financial Instruments Directive II (MiFID II), Capital Requirements Directive IV, Market Abuse Regulation, Benchmarks Regulation, Basel III and various other laws and regulations.

Please also refer to the discussion below and in " Item 1A — Risk Factors" beginning on page 15 for a description of competitive risks and uncertainties.

Competition in our Derivatives Exchange Business

14 unchanged sentences

diverse and complementary product offerings;

frequency and quality of new product development, and efficient, secure settlement, clearing and support services, distinguish us from others in the industry.

frequency and quality of new product development;

and efficient, secure settlement, clearing and support services, distinguish us from others in the industry.

We believe that in order to maintain our competitive position, we must continue to expand globally;

2 unchanged sentences

maintain liquidity and low transaction costs;

continue to strengthen our risk management capabilities and solutions, and implement customer protections designed to ensure the integrity of our market and the confidence of our customers.

continue to strengthen our risk management capabilities and solutions;

and implement customer protections designed to ensure the integrity of our market and the confidence of our customers.

We compete in a large and expanding financial services trading, clearing and settlement marketplace globally.

1 unchanged sentence

(ICE), the Hong Kong Exchanges and Clearing Limited and Deutsche Börse AG.

We have also seen the emergence of new players in the derivatives exchange business, in some cases backed by market makers and broker-dealers, as well as crypto platforms.

Competition also includes alternative means of developing exposures through alternative instruments (depending on market factors) such as cash, OTC, ETFs, options, warrants, contracts for differences, structured products and other offerings and incorporates large customer and channel internalization of trade flows and data.

3 unchanged sentences

In the past few years there has been increased competition in the provision of clearing services, and we expect competition to continue to increase in connection with compliance with Dodd-Frank, EMIR 2.2, Basel III, MiFID II and other various laws and regulations.

Our competitors in the clearing services space include, among others, companies such as ICE, LCH Group, the Options Clearing Corporation, Depository Trust & Clearing Corporation, Hong Kong Exchanges and Clearing, Japan Securities Clearing Corporation, LME Clearing and Deutsche Börse AG.

In light of the implementation of new regulatory requirements and other reforms of the financial services industry, we believe that other exchanges and infrastructure providers also may

undertake to provide clearing and other related post-trade services, such as Nodel and ERIS in the U.S., as CFTC regulated designated clearing organizations.

Our competitors in the clearing services space include, among others, companies such as ICE, LCH Group, the OCC, Depository Trust & Clearing Corporation, Hong Kong Exchanges and Clearing, Japan Securities Clearing Corporation, LME Clearing and Deutsche Börse AG.

In light of the implementation of new regulatory requirements and other reforms of the financial services industry, we believe that other exchanges and infrastructure providers also may undertake to provide clearing and other related post-trade services, such as Nodal and ERIS in the U.S., as CFTC-regulated designated clearing organizations.

We have also seen the acquisition of smaller clearing houses by larger and better capitalized firms, including FTX’s acquisition of LedgerX.

We believe competition in clearing services is based on, among other things, the value of providing customers with capital and margin efficiencies;

1 unchanged sentence

creditworthiness of the clearing house;

regulatory costs, timely delivery of the services;

regulatory costs;

timely delivery of the services;

diversity of the service offerings;

2 unchanged sentences

Competition in our Cash Markets Business

The cash markets businesses face substantial competition across a wide array of venues.

The cash markets businesses face substantial competition across a wide and growing array of venues.

In the FX space, the marketplace is highly fragmented, and there is competition from other electronic communication networks, single-dealer platforms, bank-owned multi-participant platforms, streaming and request for quote services, trading venues tied to data platforms, voice brokers, other broker enabled platforms and other venues.

2 unchanged sentences

repo, and European bond trading, as well as other products such as corporate bonds, municipal bonds, mortgage-backed bonds and agencies, and a multitude of competitors and new entrants offering single-dealer liquidity, bank-owned multi-participant platforms, streaming and request for quote services, and other broker and exchange-enabled platforms.

Competition in our Optimization Services Business

The optimization services business faces substantial competition across each of the segments in which CME Group operates.

There are multiple providers of compression services, reconciliation services, trade processing, analytics, and regulatory reporting services.

In addition, there is considerable innovation occurring in this business, with new entrants and new technologies being developed to serve customers and differentiate offerings.

Competition also comes from other clearing houses and exchange groups, who are today internalizing or have plans to internalize various services, as well as existing back office service providers, who may embed these services in their offerings.

Competition in our Market Data Business

Technology companies, market data and information vendors and front-end software vendors also represent actual and potential competitors because they have their own substantial market data distribution capabilities that could serve as alternative means for receiving open market data feeds instead of connecting directly to our exchange.

Technology companies, market data and information vendors and front-end software vendors also represent actual and potential competitors because they have their own substantial market data calculation and distribution capabilities that could serve as alternative means for receiving open market data feeds instead of connecting directly to our exchange.

Multiple other industry players offer both referential and indicative pricing alternatives to CME offerings, which are widely distributed and available across a variety of media.

Distributors and consumers of our market data may also use our market data as an input into a product that competes against one of our traded or cleared products.

2 unchanged sentences

Our businesses are regulated and serve a customer base that includes regulated institutions or individuals.

Developments in the regulatory environment have the potential to significantly affect our businesses.

Developments in the regulatory environment therefore have the potential to significantly affect our businesses.

As such, we are subject to extensive regulation, primarily in the U.S.

On January 31, 2020, the United Kingdom (U.K.) formally withdrew from the European Union (E.U.) after a majority of voters in the U.K.

approved an exit from the E.U., commonly referred to as Brexit.

As a result of Brexit, we have established certain businesses in Amsterdam, an E.U.

jurisdiction, which will allow us to continue to provide services to E.U.

We have also entered into agreements to work with E.U.-based clearing venues to clear E.U.

based repo traded products.

Additionally, amendments to EMIR 2.2 became effective during 2020, which resulted in changes to the E.U.

equivalence and recognition regime for non-E.U.

clearing houses, including CME Clearing.

The European Commission adopted several implementing and delegated acts relating to central counterparties established in third countries under the EMIR 2.2 revisions to the European Market Infrastructure Regulation.

Please also refer to the discussion below and in the “Risk Factors” section beginning on page 15 for a description of regulatory and legislative risks and uncertainties.

Please also refer to the discussion below and in "Item 1A — Risk Factors" beginning on page 15 for a description of regulatory and legislative risks and uncertainties.

Regulation of our Derivatives Business, CME Clearing and our SEF

2 unchanged sentences

The CFTC carries out the regulation of the futures and swaps markets and clearing houses in accordance with the provisions of the Commodity Exchange Act as amended by, among others, the Commodity Futures Modernization Act and Dodd-Frank.

definition of an agricultural commodity and certain provisions of the rules applicable to designated contract markets, swap execution facilities and swap data repositories.

Regulations implementing Dodd-Frank include rules relating to the implementation of mandatory clearing of certain OTC derivatives, swap reporting, operation of a clearing house, anti-manipulation, large trader reporting, product definitions, the definition of an agricultural commodity and certain provisions of the rules applicable to designated contract markets, swap execution facilities and swap data repositories.

CME has been designated as a systemically important financial market utility and a systemically important derivatives clearing organization.

7 unchanged sentences

as a multilateral trading facility and regulated market and by the applicable regulators in Singapore and Canada.

Our EBS business holds various permissions, approvals and exemptions globally, including those that subject certain of its activities to CFTC, FCA, AFM and Hong Kong Monetary Authority (HKMA) oversight.

Our EBS business holds various permissions, approvals and exemptions globally, including those that subject certain of its activities to CFTC, FCA, the Dutch Authority for the Financial Markets (AFM) and Hong Kong Monetary Authority (HKMA) oversight.

The settlement of matched principal and exchange-traded businesses requires access to clearing houses either directly or through third-party providers of clearing and settlement services.

BrokerTec Americas is a member of the Fixed Income Clearing Corp.

(FICC) through which it clears U.S.

BrokerTec Americas is a member of the FICC, through which it clears U.S.

Treasury and repo products.

Regulation of our Optimization Services Business

Certain areas of our optimization services, which enable clients to mitigate their risk, reduce operational costs, optimize their capital, and fulfill trade reporting obligations, are subject to regulatory oversight in those jurisdictions in which we conduct business, including the Swedish Financial Supervisory Authority, the FCA, CFTC, the National Futures Association, ESMA, the Australian Securities and Investments Commission and HKMA.

Regulation of our Market Data Business

1 unchanged sentence

Benchmarks Regulation, which regulates our RepoFunds Rate suite of daily Euro repo indices.

Our CME Group Benchmark Administration, which is authorized as a Benchmark Administrator by the FCA, administers and calculates the CME Term Secured Overnight Financing Rate (SOFR) Reference Rates group of benchmarks.

Key Areas of Focus

We actively monitor and participate in the domestic and international rulemaking processes for our industry, including providing government testimony, commenting on proposed rulemaking and educating our regulators on potential impacts to the marketplace.

We are also focused on the new U.S.

Presidential administration and any anticipated changes that may result.

We actively monitor and participate in the domestic and international legislative and rulemaking processes for our industry, including providing government testimony, commenting on proposed legislation and rulemaking, and educating our regulators and policymakers on potential impacts to the marketplace.

We are also focused on the U.S.

Presidential administration and its new federal regulatory appointees and any anticipated changes that may result.

Our key areas of focus in the regulatory environment are:

• The potential impact of the adoption of EMIR 2.2 allowing for the direct regulation by the E.U.

clearing houses, like ours, and resulting changes to the E.U.

equivalence and recognition regime on non-E.U.

clearing houses and exchanges with customers based in Europe.

EMIR 2.2 became effective on January 1, 2020, and as of December 31, 2020, we do not anticipate a significant impact to our business.

• Rules respecting capital charges under Basel III with respect to clearing members of central counterparties may have negative implications for the cleared derivatives markets.

Additional risks could arise through inconsistent adoption of the Basel III capital charges globally, potentially leading to disparate impacts on our customers.

• The potential for further regulation stemming from industry performance disruptions and residual concerns around electronic trading activity and, in particular, "high frequency trading."

• The potential elimination of the 60/40 tax treatment of certain of our futures and options contracts, which would result in 60% of the gains being taxed at the short-term capital gain rate instead of the long-term capital gain rate.

This would impose a significant increase in tax rates applicable to certain market participants and could result in a decrease in their trading activity.

• The FCA’s announcement of its phase out of the use of LIBOR, which may unfavorably impact our ability to list our existing suite of Eurodollar futures and options products.

• The implementation of a transaction tax or user fee in the U.S., U.K.

or E.U., or in the States of Illinois or New Jersey, which could discourage institutions and individuals from using our markets or products or encourage them to trade in another less costly jurisdiction.

Legislation to impose a financial transaction tax has been proposed in the U.S.

Congress, Illinois General Assembly and State of New Jersey Legislature in the last legislative sessions and could be proposed again in the current legislative sessions.

Additionally, from time to time, the proposed U.S.

, or in the States of Illinois or New Jersey, which could discourage institutions and individuals from using our markets or products or encourage them to trade in another less costly jurisdiction.

Legislation to impose a financial transaction tax has been proposed previously in the U.S.

Congress, Illinois General Assembly and State of New Jersey Legislature.

Additionally, from time to time, including this fiscal year, the proposed U.S.

Presidential budget request has included a proposal to impose a user fee to fund all or a portion of the budget of the CFTC.

Legislation would be necessary to impose such a fee.

• The potential for further regulation stemming from industry performance disruptions and residual concerns around electronic trading activity and, in particular, "high frequency trading."

• Legislation that proposes to eliminate the 60/40 tax treatment of certain of our futures and options contracts, which would result in 60% of the gains being taxed at the short-term capital gain rate instead of the long-term capital gain rate.

This would impose a significant increase in tax rates applicable to certain market participants and could result in a decrease in their trading activity.

• Certain provisions in relation to the E.U.

Regulations on Benchmarks came into effect on January 1, 2018, and prices and data provided by CME Group for use by E.U.

Regulations on Benchmarks have yet to come into effect, and prices and data provided by CME Group for use by E.U.

supervised entities and use of those benchmarks may be impacted.

On November 30, 2020, the European Commission, European Parliament and the Council agreed to postpone application of the rules on third country benchmarks until December 31, 2023.

As a result, all prices and data provided by CME Group are available for use by E.U.

supervised entities throughout the transition period until January 1, 2023, subject to entering into appropriate licensing arrangements where relevant.

The implementation of legislation in the E.U.

impacting how benchmark index prices are formed, including new requirements for price submitters, price aggregators and markets that list contracts that reference index prices.

• Concerns that European legislators will prohibit or restrict exclusive licenses for benchmark indexes, which might impact the profitability of several of our most popular contracts.

• The FCA has indicated that it will no longer require banks to participate in the LIBOR panel after December 31, 2021.

The possibility exists that the FCA may find LIBOR to not be representative of the underlying short-term interest rate pricing or unfit for such purpose, and thus may unfavorably impact our ability to list our existing suite of Eurodollar futures and options products.

• The implementation of rules resulting in negative treatment of the liquidity profile of U.S.

1 unchanged sentence

Treasury securities as collateral could result in increased costs to us and our clearing firms.

• The implementation of the final phases of uncleared margin rules (UMR Phase 5 & 6) across jurisdictions and implications for customers' management of exposures.

• The implementation of the final phases of uncleared margin rules (UMR Phases 5 & 6) across jurisdictions and implications for customers' management of exposures.

• The potential regulation of cryptocurrencies, which may impact our existing offerings or our ability to provide future offerings.

Please also see "Item 1A - Risk Factors" beginning on page 15 for additional information on our areas of regulatory risks.

Human Capital Management

At CME Group, we rely on our highly skilled and experienced global workforce to meet our business objectives.

At CME Group, we rely on our highly skilled and experienced global workfor ce to meet our business objectives.

As of December 31, 2021, our global employee population consisted of approximately 3,480 staff, with 67% (approximately 2,320) of these employees working in the U.S.

and the remaining 33% (approximately 1,160) working in our various non-U.S.

locations (Australia, Brazil, Canada, China, France, Germany, Hong Kong, India, Israel, Japan, Netherlands, Philippines, Singapore, South Korea, Sweden, Switzerland and the U.K.).

locations (Australia, Brazil, Canada, China, France, Hong Kong, India, Israel, Japan, Netherlands, Singapore, South Korea, Sweden, Switzerland and the U.K.).

We recognize that fostering a diverse and inclusive global culture is critical to our business success.

5 unchanged sentences

• Our competitive compensation programs align employee rewards with shareholder interests and emphasize our pay-for-performance philosophy.

• Our Employee Network Groups (ENGs) are essential to fostering an inclusive culture grounded in mutual respect.

All employees are eligible to join our ENGs and employees are encouraged to form new ENGs that align with our shared mission and values, creating communities around professional and personal interests.

• Our Employee Resource Groups (ERGs) are essential to fostering an inclusive culture grounded in mutual respect.

All employees are eligible to join our ERGs and employees are encouraged to form new ERGs that align with our shared mission and values, creating communities around professional and personal interests.

We conduct regular employee engagement surveys and we monitor our performance against specific voluntary turnover, open role placement and internal promotion metrics to understand where further workforce investments may be necessary.

3 unchanged sentences

• 11.6% of employees promoted

The above metrics exclude approximately 150 staff who do not fully participate in our talent programs.

Diversity and Inclusion

At CME Group, we embrace an exchange of ideas driven by the rich diversity of our people, cultures and experiences.

As the world’s leading and most diverse derivatives marketplace, we embrace an exchange of ideas driven by the rich diversity of our people, cultures and experiences.

We know that when our employees bring their authentic selves to work each day, it makes our business and our culture that much stronger.

3 unchanged sentences

Members of our management team and employees from across our global workforce serve on the council, representing a wide variety of backgrounds and perspectives.

For more information, please refer to our current Corporate Citizenship & Sustainability Report, which is available on our website at www.cmegroup.com under the "Corporate Citizenship" link.

For more information regarding our sustainability practices and to review our annual Corporate Citizenship & Sustainability Reports, including our report for 2021 when issued, please visit:

https://www.cmegroup.com/company/corporate-citizenship/esg.html.

Information about our Executive Officers

11 unchanged sentences

Sunil Cutinho , 50 .

Cutinho has served as President of CME Clearing since 2014.

Cutinho has served as our Chief Information Officer since February 2022 and previously has served as President of CME Clearing since 2014.

He joined CME Group in 2002 and since then has held various positions of increasing responsibility within the organization, and most recently served as Managing Director, Deputy Head of CME Clearing from April 2014 through September 2014.

Lynne Fitzpatrick, 43.

Fitzpatrick has served as Senior Managing Director & Deputy Chief Financial Officer since February 2022.

She previously served as Managing Director of Corporate Development and Treasurer of CME Group since 2017, leading the company’s business development, mergers and acquisitions, CME Ventures and corporate treasury functions.

Since joining the company in 2006, Fitzpatrick has held a variety of positions with increasing levels of responsibility within the finance organization.

Prior to CME Group she worked as an investment banker at Credit Suisse and UBS.

Julie Holzrichter, 53.

Holzrichter has served as our Senior Managing Director, Chief Operating Officer since 2014.

Holzrichter has served as our Senior Managing Director, Chief Operating Officer since 2014 and in February 2022, her role expanded to oversee Global Operations and CME Clearing.

She previously served as our Senior Managing Director, Global Operations from 2007.

1 unchanged sentence

Holzrichter previously held positions of increasing responsibility in our organization from 1986 to 2003 in trading operations.

Kevin Kometer, 56.

Kometer has served as Senior Managing Director and Chief Information Officer since 2008.

He previously served as Managing Director and Deputy Chief Information Officer from 2007 to 2008.

Since joining the company most recently in 1998, he has held senior leadership positions in the Technology Division, including Managing Director, Trading Execution Systems and Director, Advanced Technology.

Kometer was also with the company from 1994 to 1996.

Holzrichter also serves as a director of Constellation Energy Corporation, an Exelon company.

Tim McCourt, 43 .

McCourt has served as Senior Managing Director, Global Head of Equity and FX Products since February 2022.

He is responsible for leading the development and execution of the company’s global equity index, foreign exchange, cryptocurrency and alternative investment product strategies.

He serves on the CME Ventures Investment Committee and the S&P Dow Jones Indices U.S.

Advisory Panel.

Before joining CME Group in 2013 as Global Head of Equity Products, Mr.

McCourt worked for the Royal Bank of Scotland, where he was responsible for building and managing the Americas Index and Delta One trading book.

Prior to RBS, he held a senior trading role with JPMorgan in New York, spending 10 years with the Equity Derivatives Group.

Hilda Harris Piell, 54 .

2 unchanged sentences

Pietrowicz, 57.

Pietrowicz has served as our Chief Financial Officer since 2014.

Pietrowicz has served as Senior Managing Director and Chief Financial Officer since 2014.

Previously, Mr.

2 unchanged sentences

Pietrowicz also serves as a director of S&P/Dow Jones Indices LLC.

Pietrowicz announced his plans to retire in 2023 and Ms.

Fitzpatrick will succeed him.

Derek Sammann, 53 .

Sammann has served as our Senior Managing Director, Commodities and Options Products since 2014.

Sammann has served as our Senior Managing Director, Global Head of Commodities and Options and International Markets since November 2021 and previously served as our Senior Managing Director, Commodities and Options Products since 2014.

He previously served as our Senior Managing Director, Financial Products and Services since 2009 and Global Head of Foreign Exchange Products since joining us in 2006.

1 unchanged sentence

Sammann served as Managing Director, Global Head of FX Options and Structured Products at Calyon Corporate and Investment Bank in London from 1997 to 2006.

Suzanne Sprague, 41.

Sprague has served as Senior Managing Director & Global Head of Clearing and Post-Trade Services for CME Group since February 2022.

She joined the company in 2002 and has held numerous roles and leadership positions in financial management and risk management since that time.

During her tenure, she has played a key role in the company’s development of risk management policy.

Since 2015, she served as Managing Director, Credit & Liquidity Risk, Risk Policy & Banking, overseeing CME Clearing’s exposure to counterparty credit risk, liquidity risk management and financial performance, acceptable collateral and collateral services, risk management policies and procedures, financial operations, and banking.

Jack Tobin, 58 .

Tobin has served as our Chief Accounting Officer since 2015.

Tobin has served as Managing Director and Chief Accounting Officer since 2015.

Tobin most recently served as our Managing Director, Corporate Finance since 2007.

5 unchanged sentences

Sean Tully, 58 .

Tully has served as Senior Managing Director, Financial and OTC Products of CME Group since 2014.

He previously served as Senior Managing Director, Interest Rates and OTC Products during 2014.

Previously, he served as Managing Director, Interest Rate and OTC Products since 2013 and as our Managing Director, Interest Rate Products since

joining us in 2011.

Tully has served as Senior Managing Director, Global Head of Rates and OTC Products since February 2022.

He previously served as Senior Managing Director, Financial and OTC Products of CME Group since 2014.

previously served as Senior Managing Director, Interest Rates and OTC Products during 2014.

Previously, he served as Managing Director, Interest Rate and OTC Products since 2013 and as our Managing Director, Interest Rate Products since joining us in 2011.

Before joining the company, Mr.

1 unchanged sentence

Kendal Vroman, 50.

Vroman has served as our Senior Managing Director, International and Optimization Services since February 2020.

He previously served as our Senior Managing Director, Cash Markets and Optimization Services.

Vroman has served as our Senior Managing Director, Chief Transformation Officer since November 2021.

He previously served as Senior Managing Director, International and Optimization Services since February 2020 and as our Senior Managing Director, Cash Markets and Optimization Services.

Since joining the company in 2001, he has held a variety of senior leadership roles, including Managing Director, Planning and Execution, Global Head, Commodity Products and OTC Solutions and Managing Director and Chief Corporate Development Officer.

11 unchanged sentences

We make available on our website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports as soon as reasonably practicable after we electronically file or furnish such materials to the SEC.

Our corporate governance materials, including our Corporate Governance Principles, Director Conflict of Interest Policy, Board of Directors Code of Ethics, Categorical Independence Standards, Employee Code of Conduct and the charters for all the committees of our board, also may be found on our website.

Copies of these materials also are available to shareholders free of charge upon written request to Shareholder Relations, Attention Ms.

Beth Hausoul, CME Group Inc., 20 South Wacker Drive, Chicago, Illinois 60606.

Our corporate governance materials may also be found on our website.

The SEC also maintains an Internet site that contains reports, proxy and information statements, and other reports that we file or furnish with the SEC at http://www.sec.gov.

Copies of these materials also are available to shareholders free of charge upon request to Shareholder Relations, office.ofthesecretary@cmegroup.com.

Information regarding our sustainability practices is available in our annual Corporate Citizenship & Sustainability Reports, including our report for 2021 when issued, at the following:

https://www.cmegroup.com/company/corporate-citizenship/esg.html.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business