CME Expands Efforts to Grow Trading Volume of Equity Index Options on Futures Markets

Plan Includes Conversion to European Style Options Expiration and Addition of Market Makers in E-mini^™ S&P 500^® Equity Options

CHICAGO, Aug. 23 /PRNewswire/ -- As part of its aggressive growth strategy to increase trading in its equity index options on futures markets, Chicago Mercantile Exchange Inc. (CME), the largest futures exchange in the U.S., today announced all equity index options products listed on the exchange will be converted from American to European style expiration. Additionally, in response to increased demand for electronic trading of CME's E-mini^™ S&P 500^® options on futures contract, the exchange will add designated market makers and introduce a nine-month GLOBEX^® customer fee waiver to help generate further liquidity and attract new customer participation in this growing electronic market. Beginning October 1, 2004 through June 2005, the GLOBEX electronic trading fee will be waived for customers trading CME's E- mini S&P 500 options.

"By trading European style options electronically with designated market makers in our most active E-mini S&P 500 options on futures market, CME will be well positioned to significantly increase trading volume in its equity index options," said CME Chairman Terry Duffy. "Trading in our E-mini S&P 500 options on futures has doubled since November 2003, along with record open interest. We want to continue to leverage this momentum to benefit our customers and shareholders."

"One of CME's main strategies is to promote growth in all of our financial options products and the introduction of European style exercise, as well as market maker and customer pricing incentives for our E-mini S&P 500 equity options, is part of this broader strategy," said Craig Donohue, CME's Chief Executive Officer. "We expect to build on the success of our recent launch of electronically traded Eurodollar options, where average daily volume has grown from 3,300 in January 2004 to 33,000 so far this month."

The conversion to European-style options expiration, which will take place in an orderly fashion over several months as outlined below, applies to all equity index options contracts traded via CME's electronic or open outcry markets.

Under European-style rules, options holders are allowed to exercise their contract only on the date of expiration vs. American style which can be exercised into a futures position at any time prior to expiration.

The conversion schedule for CME's equity index options on futures contracts is as follows:

     CME Equity index options      Expiration Date          Trading Style
     Contract

     S&P 500; S&P MidCap 400       On or before June 2005   American Style
     NASDAQ-100, Russell 2000,                              Exercise
     Nikkei 225

     S&P 500; S&P MidCap 400       After June 2005          European Style
     NASDAQ-100, Russell 2000,                              Exercise
     Nikkei 225

     E-mini S&P 500, S&P 500       On or before December    American Style
     Barra Growth Index,           2004                     Exercise
     S&P 500 Barra Value

     E-mini S&P 500, S&P 500       After December 2004      European Style
     Barra Growth Index,                                    Exercise
     S&P 500 Barra Value

To give market participants time to make any necessary changes, CME's March 2005 options on E-mini S&P 500, S&P 500 Barra Growth and S&P 500 Barra Value Index futures, originally scheduled to be listed for trading following the expiration of the September 2004 options, will be listed following the expiration of the October 2004 options on Monday, October 18, 2004. The September 2005 options on S&P 500, S&P MidCap 400 and Russell 2000 stock index futures, originally scheduled to be listed for trading following the expiration of the September 2004 options, will also be listed following the expiration of the October 2004 options on Monday, October 18.

"There are a number of potential new customers who are interested in trading CME's equity index options contracts, who will be able to trade additional strategies because of the European expiration feature," said Rick Redding, Managing Director of CME Product & Services. "By building increased liquidity in our E-mini S&P 500 options traded on GLOBEX, we will be able to better serve those customers who prefer to trade electronically."

With the addition of dedicated market makers who will be committed to providing liquidity, CME will be able to offer users of this market increased levels of flexibility, transparency and execution.

Chicago Mercantile Exchange Inc. ( http://www.cme.com ) is the largest futures exchange in the United States. As an international marketplace, CME brings together buyers and sellers on its trading floors and GLOBEX^® electronic trading platform. CME offers futures and options on futures primarily in four product areas: interest rates, stock indexes, foreign exchange and commodities. The exchange moved about $1.6 billion per day in settlement payments in the first half of 2004 and managed $39.1 billion in collateral deposits as of June 30, 2004. CME is a wholly owned subsidiary of Chicago Mercantile Exchange Holdings Inc. (NYSE: CME), which is part of the Russell 1000^® Index.

Statements in this news release that are not historical facts are forward- looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statements. More detailed information about factors that may affect our performance may be found in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-Q, which can be obtained at its Web site at http://www.sec.gov . We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

Chicago Mercantile Exchange, CME, the globe logo and GLOBEX are registered trademarks of Chicago Mercantile Exchange Inc. E-mini is a trademark of CME. CLEARING 21 is a registered trademark of CME and New York Mercantile Exchange, Inc. S&P, S&P 500, NASDAQ-100, Nikkei 225, Russell 1000, Russell 2000, TRAKRS, Total Return Asset Contracts and other trade names, service marks, trademarks and registered trademarks that are not proprietary to Chicago Mercantile Exchange Inc. are the property of their respective owners, and are used herein under license. Further information about CME and its products is available on the CME Web site at http://www.cme.com .

SOURCE Chicago Mercantile Exchange Inc.

CONTACT: Media, Anita S. Liskey, +1-312-466-4613, or Allan Schoenberg, +1-312-930-3446, news@cme.com , or Investor, John Peschier, +1-312-930-8491, all of Chicago Mercantile Exchange Web site: http://www.cme.com

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Chicago Mercantile Exchange's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.