Continuous Commodity Index
Though it has gone through many revisions since the inaugural use, the Continuous Commodity Index (CCI) has aimed to provide an accurate representation of commodity price trends. Contract specifications here will refer to the CCI futures on ICE US.
Contract Size: $500 x Index
Price Quote & Tick Size: Quoted in index points, to two decimal places. (e.g.,300.05, 300.10, 300.15).01 = $5; tick size is .05 = $25
Contract Months: January, February, April, June, August and November
Trading Specs: Futures trade on ICE US from 2:30 am to 2:45 pm next day
Daily Price Limit: None as of publishing; please consult exchange for additional details on limits.
Trading Symbols: CI
Past performance is not indicative of future results.
***chart courtesy of Gecko Software
CCI Facts
The Commodity Research Bureau first developed an index based on commodity prices in the middle part of the last century. Originally, it was composed of twenty-eight commodities. The current representation of the CCI contains seventeen. They include:
* Crude Oil
* Heating Oil
* Natural Gas
* Corn
* Soybeans
* Wheat
* Copper
* Cotton
* Live Cattle
* Lean Hogs
* Gold
* Platinum
* Silver
* Cocoa
* Coffee
* Orange Juice
* Sugar #11
This kind of index may be more difficult to understand than a basket of stocks since the active contract for each commodity changes. The change occurs when the nearby futures contract expires. For this reason, this kind of index may have to be rebalanced. The original CRB index was also heavily weighted towards commodities in the agricultural sector. Now, the balance is relative to the following chart:
Key Uses
CCI futures may be incorporated into strategies to hedge cash market positions, diversify holdings, or as a means to trade a directional bias on the possible future price trends for commodities.
Key Concerns
Since commodity prices are the constituents of the index, the CCI may be influenced by some or all of the same things which will cause fluctuations in commodity prices. These could include - but are not limited to - events or fundamentals like the following:
* Industry reports
* Inventories or supply reports for specific commodities
* National or global recessions
* Weather issues
* Crop reports
* Central bank meetings or policy changes
* US dollar movements
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