How to read CME data- A wealth of information available free of charge

The Chicago Mercantile Exchange (CME) website offers a tremendous amount of data and information for traders and investors of all levels. While the CME charges for historical data, real time data is available, free of charge with a ten-minute delay on prices published on the site.

The CME offers futures and options on a myriad of commodity products including energy, agriculture, metals, soft commodities and animal proteins.

The exchange also offers a full suite of financial products including futures and options on equities, debt and foreign exchange. Anyone involved in trading or investing should use the CME data as a ready reference in order to conduct the analysis required to make wise decisions.

When it comes to futures markets, understanding how to read and interpret the CME data will turn the site into a gold mine of information. On its site, the CME outlines each product covered in terms of contract specifications and other idiosyncratic details related to that market or product. Futures contracts are standardized which allows for liquidity and opens the market to a broad spectrum of participants in a transparent environment. The CME descriptions cover topics such as contract size (quantity of the asset represented by one futures contract), quality (the deliverable specifics of each product), trading hours, minimum price fluctuations, margins, months traded as well as other issues related to the trading of specific market vehicles.

At the same time, the CME also offers daily data on the futures contracts themselves that contains the following information:

Open: the opening price for the current trading session.

High: the highest price traded for the vehicle during the current trading session.

Low: the lowest price traded for the vehicle during the current trading session.

Last: this is the last updated price that a buyer and seller have transacted at during the current trading session.

High/Low limit: some markets have daily trading limits. Trading will stop if the market price reaches and will trade through either the high or the low limit.

Change: this is the differential between the price at which the market is currently trading and the settlement price of the previous trading session.

Settlement: this is the final price of a trading session. The settlement price is important as the exchange clearinghouse calculates all margins based on the daily settlement price.

Prior Settlement: this is the final price of the previous trading session.

Volume: volume is the total number of futures or options contracts bought and sold during the current trading session. Volume is a great way to gauge market activity.

Open interest: open interest is the total number of long and short positions that are open and not yet closed in the futures contract in question. While volume can only increase, open interest can increase and decrease with position adjustments in a market. Open interest is a great indicator of positions held in futures markets. Generally, the CME delays open interest data by one day.

Charts: the CME offers price charts or pictorials of historical price action for all of the products covered on the exchange free of charge.

Options: the CME offers price data on call and put options that trade based on underlying prices of futures contracts.

While the CME is the world's largest commodity futures exchange, other exchanges around the world offer similar data and information on their sites. The Intercontinental Exchange (ICE) offers a myriad of data as does the London Metals Exchange (LME). Understanding and monitoring the information on these exchange websites is just another tool to add to your investment tool chest when it comes to the process of collecting data in order to make wise trading or investment choices.