UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2020~~March 31, 2021

- OR -


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-31553

CME GROUP INC.

(Exact name of registrant as specified in its charter)

Delaware

36-4459170

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

20 South Wacker Drive

Chicago

Illinois

60606

(Address of principal executive offices)

(Zip Code)

(312) 930-1000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol	Name of each exchange on which registered
Class A Common Stock	CME	Nasdaq

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

The number of shares outstanding of each of the registrant’s classes of common stock as of ~~October~~April 14, ~~2020~~2021 was as follows: ~~358,987,459~~359,094,042 shares of Class A common stock, $0.01 par value; 625 shares of Class B-1 common stock, $0.01 par value; 813 shares of Class B-2 common stock, $0.01 par value; 1,287 shares of Class B-3 common stock, $0.01 par value; and 413 shares of Class B-4 common stock, $0.01 par value.

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CME GROUP INC.

FORM 10-Q

INDEX



		Page

PART I. FINANCIAL INFORMATION		3

Item 1.	Financial Statements	5

	Consolidated Balance Sheets at ~~September~~ ~~30, 2020~~March 31, 2021 and December 31, ~~2019~~2020	5

	Consolidated Statements of Income for the Quarters Ended March 31, 2021 and ~~Nine~~ ~~Months Ended~~ ~~September~~ ~~30,~~ 2020 ~~and 2019~~	6

	Consolidated Statements of Comprehensive Income for the Quarters Ended March 31, 2021 and ~~Nine~~ ~~Months Ended~~ ~~September~~ ~~30,~~ 2020 ~~and 2019~~	7

	Consolidated Statements of Equity for the Quarters Ended March 31, 2021 and ~~Nine~~ ~~Months Ended~~ ~~September~~ ~~30,~~ 2020 ~~and 2019~~	8

	Consolidated Statements of Cash Flows for the ~~Nine~~ ~~Months~~Quarters Ended ~~September~~ ~~30,~~March 31, 2021 and 2020 ~~and 2019~~	1210

	Notes to Unaudited Consolidated Financial Statements	1412

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2522

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3330

Item 4.	Controls and Procedures	3430

PART II. OTHER INFORMATION		3430

Item 1.	Legal Proceedings	3430

Item 1A.	Risk Factors	3430

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3431

Item 6.	Exhibits	3531

SIGNATURES		3632

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PART I. FINANCIAL INFORMATION

Certain Terms

All references to “options” or “options contracts” in the text of this document refer to options on futures contracts.

Further information about CME Group and its products can be found at http://www.cmegroup.com. Information made available on our website does not constitute a part of this Quarterly Report on Form 10-Q.

Information about Contract Volume and Average Rate per Contract

All amounts regarding contract volume and average rate per contract are for CME Group's listed futures and options on futures contracts unless otherwise noted.

Trademark Information

CME Group, the Globe logo, CME, Chicago Mercantile Exchange, Globex, and E-mini are trademarks of Chicago Mercantile Exchange Inc. CBOT and Chicago Board of Trade are trademarks of Board of Trade of the City of Chicago, Inc. NYMEX, New York Mercantile Exchange and ClearPort are trademarks of New York Mercantile Exchange, Inc. COMEX is a trademark of Commodity Exchange, Inc. NEX, BrokerTec, EBS, TriOptima, and Traiana are trademarks of various entities of NEX Group Limited (NEX). Dow Jones, Dow Jones Industrial Average, S&P 500 and S&P are service and/or trademarks of Dow Jones Trademark Holdings LLC, Standard & Poor's Financial Services LLC and S&P/Dow Jones Indices LLC, as the case may be, and have been licensed for use by Chicago Mercantile Exchange Inc. All other trademarks are the property of their respective owners.

Forward-Looking Statements

From time to time, in this Quarterly Report on Form 10-Q as well as in other written reports and verbal statements, we discuss our expectations regarding future performance. These forward-looking statements are identified by their use of terms and phrases such as ~~“believe,” “anticipate,” “could,” “estimate,” “intend,” “may,” “plan,” “expect”~~"believe," "anticipate," "could," "estimate," "intend," "may," "plan," "expect" and similar expressions, including references to assumptions. These forward-looking statements are based on currently available competitive, financial and economic data, current expectations, estimates, forecasts and projections about the industries in which we operate and management's beliefs and assumptions. 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. We want to caution you not to place undue reliance on any forward-looking statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Among the factors that might affect our performance are:

•increasing competition by foreign and domestic entities, including increased competition from new entrants into our markets and consolidation of existing entities;

•our ability to keep pace with rapid technological developments, including our ability to complete the development, implementation and maintenance of the enhanced functionality required by our customers while maintaining reliability and ensuring that such technology is not vulnerable to security risks;

•our ability to continue introducing competitive new products and services on a timely, cost-effective basis, including through our electronic trading capabilities, and our ability to maintain the competitiveness of our existing products and services, including our ability to provide effective services to the swaps market;

•our ability to adjust our fixed costs and expenses if our revenues decline;

•our ability to maintain existing customers at substantially similar trading levels, develop strategic relationships and attract new customers;

•our ability to expand and globally offer our products and services;

•changes in regulations, including the impact of any changes in laws or government ~~policy~~policies with respect to our products or services or our industry, such as any changes to regulations and policies that require increased financial and operational resources from us or our customers;

•the costs associated with protecting our intellectual property rights and our ability to operate our business without violating the intellectual property rights of others;

•decreases in revenue from our market data as a result of decreased demand or changes to regulations in various jurisdictions;

•changes in our rate per contract due to shifts in the mix of the products traded, the trading venue and the mix of customers (whether the customer receives member or non-member fees or participates in one of our various incentive programs) and the impact of our tiered pricing structure;

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•the ability of our credit and liquidity risk management practices to adequately protect us from the credit risks of clearing members and other counterparties, and to satisfy the margin and liquidity requirements associated with the BrokerTec matched principal business;

•the ability of our compliance and risk management methods to effectively monitor and manage our risks, including our ability to prevent errors and misconduct and protect our infrastructure against security breaches and misappropriation of our intellectual property assets;

•our dependence on third-party providers and exposure to risk through ~~third-parties,~~third parties, including risks related to the performance, reliability and security of technology used by our third-party providers;

•volatility in commodity, equity and fixed income prices, and price volatility of financial benchmarks and instruments such as interest rates, credit spreads, equity indices, fixed income instruments and foreign exchange rates;

•economic, social, political and market conditions, including the volatility of the capital and credit markets and the impact of economic conditions on the trading activity of our current and potential customers;

•the impact of the COVID-19 pandemic and response by governments and other third parties;

•our ability to accommodate increases in contract volume and order transaction traffic and to implement enhancements without failure or degradation of the performance of our trading and clearing systems;

•our ability to execute our growth strategy and maintain our growth effectively;

•our ability to manage the risks, control the costs and achieve the synergies associated with our strategy for acquisitions, investments and alliances, including those associated with ~~the acquisition of~~ NEX;

•our ability to continue to generate funds and/or manage our indebtedness to allow us to continue to invest in our business;

•industry and customer consolidation;

•decreases in trading and clearing activity;

•the imposition of a transaction tax or user fee on futures and options transactions and/or repeal of the 60/40 tax treatment of such transactions;

•our ability to maintain our brand and reputation; and

•the unfavorable resolution of material legal proceedings.

For a detailed discussion of these and other factors that might affect our performance, see Item 1A. of our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February ~~28, 2020~~26, 2021 and Item 1A. of this Quarterly Report on Form 10-Q.

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ITEM 1.			FINANCIAL STATEMENTS

CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(dollars in millions, except par value data; shares in thousands)


		September 30, 2020		December 31, 2019			March 31, 2021		December 31, 2020
		(unaudited)					(unaudited)
Assets	Assets					Assets
Current Assets:	Current Assets:					Current Assets:
Cash and cash equivalents	Cash and cash equivalents	$	1,332.1	$	1,551.4	Cash and cash equivalents	$	936.4	$	1,633.2
Marketable securities	Marketable securities	92.4		83.2		Marketable securities	105.2		100.9
Accounts receivable, net of allowance of $4.8 and $3.4		490.9		491.8
Other current assets (includes $4.5 and $4.3 in restricted cash)		350.1		364.4
Accounts receivable, net of allowance of $6.0 and $5.4						Accounts receivable, net of allowance of $6.0 and $5.4	547.0		461.3
Assets held for sale						Assets held for sale	1,447.5		0
Other current assets (includes $4.5 and $4.7 in restricted cash)						Other current assets (includes $4.5 and $4.7 in restricted cash)	295.4		306.7
Performance bonds and guaranty fund contributions	Performance bonds and guaranty fund contributions	88,083.8		37,077.0		Performance bonds and guaranty fund contributions	123,414.0		86,781.8
Total current assets	Total current assets	90,349.3		39,567.8		Total current assets	126,745.5		89,283.9
Property, net of accumulated depreciation and amortization of $931.9 and $867.5		547.2		544.0
Property, net of accumulated depreciation and amortization of $946.5 and $961.2						Property, net of accumulated depreciation and amortization of $946.5 and $961.2	528.6		579.2
Intangible assets—trading products	Intangible assets—trading products	17,175.3		17,175.3		Intangible assets—trading products	17,175.3		17,175.3
Intangible assets—other, net	Intangible assets—other, net	4,893.8		5,117.7		Intangible assets—other, net	3,716.8		4,865.3
Goodwill	Goodwill	10,755.8		10,742.5		Goodwill	10,534.3		10,798.8
Other assets (includes $0.7 and $0.9 in restricted cash)		2,037.4		2,068.0
Other assets (includes $3.1 and $0.6 in restricted cash)						Other assets (includes $3.1 and $0.6 in restricted cash)	1,951.6		1,957.1
Total Assets	Total Assets	$	125,758.8	$	75,215.3	Total Assets	$	160,652.1	$	124,659.6

Liabilities and Equity	Liabilities and Equity					Liabilities and Equity
Current Liabilities:	Current Liabilities:					Current Liabilities:
Accounts payable	Accounts payable	$	99.5	$	61.9	Accounts payable	$	51.6	$	69.3

Liabilities held for sale						Liabilities held for sale	278.8		0
Other current liabilities	Other current liabilities	448.0		1,384.8		Other current liabilities	478.1		1,346.8
Performance bonds and guaranty fund contributions	Performance bonds and guaranty fund contributions	88,083.4		37,075.8		Performance bonds and guaranty fund contributions	123,414.0		86,781.8
Total current liabilities	Total current liabilities	88,630.9		38,522.5		Total current liabilities	124,222.5		88,197.9
Long-term debt	Long-term debt	3,442.2		3,743.2		Long-term debt	3,443.6		3,443.8
Deferred income tax liabilities, net	Deferred income tax liabilities, net	5,620.8		5,635.2		Deferred income tax liabilities, net	5,371.9		5,607.0
Other liabilities	Other liabilities	1,054.5		1,155.1		Other liabilities	1,058.2		1,059.4
Total Liabilities	Total Liabilities	98,748.4		49,056.0		Total Liabilities	134,096.2		98,308.1

Shareholders’ Equity:	Shareholders’ Equity:					Shareholders’ Equity:
Preferred stock, $0.01 par value, 10,000 shares authorized at September 30, 2020 and December 31, 2019; none issued		0		0
Class A common stock, $0.01 par value, 1,000,000 shares authorized at September 30, 2020 and December 31, 2019; 358,030 and 357,469 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively		3.6		3.6
Class B common stock, $0.01 par value, 3 shares authorized, issued and outstanding as of September 30, 2020 and December 31, 2019		0		0
Preferred stock, $0.01 par value, 10,000 shares authorized at March 31, 2021 and December 31, 2020; none issued						Preferred stock, $0.01 par value, 10,000 shares authorized at March 31, 2021 and December 31, 2020; none issued	0		0
Class A common stock, $0.01 par value, 1,000,000 shares authorized at March 31, 2021 and December 31, 2020; 358,240 and 358,110 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively						Class A common stock, $0.01 par value, 1,000,000 shares authorized at March 31, 2021 and December 31, 2020; 358,240 and 358,110 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	3.6		3.6
Class B common stock, $0.01 par value, 3 shares authorized, issued and outstanding as of March 31, 2021 and December 31, 2020						Class B common stock, $0.01 par value, 3 shares authorized, issued and outstanding as of March 31, 2021 and December 31, 2020	0		0
Additional paid-in capital	Additional paid-in capital	21,157.2		21,113.2		Additional paid-in capital	21,193.5		21,185.5
Retained earnings	Retained earnings	5,775.1		5,008.7		Retained earnings	5,247.3		4,995.9
Accumulated other comprehensive income (loss)	Accumulated other comprehensive income (loss)	43.7		3.4		Accumulated other comprehensive income (loss)	83.5		134.9
Total CME Group Shareholders’ Equity	Total CME Group Shareholders’ Equity	26,979.6		26,128.9		Total CME Group Shareholders’ Equity	26,527.9		26,319.9
Non-controlling interests	Non-controlling interests	30.8		30.4		Non-controlling interests	28.0		31.6
Total Equity	Total Equity	27,010.4		26,159.3		Total Equity	26,555.9		26,351.5
Total Liabilities and Equity	Total Liabilities and Equity	$	125,758.8	$	75,215.3	Total Liabilities and Equity	$	160,652.1	$	124,659.6

See accompanying notes to unaudited consolidated financial statements.

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CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(dollars in millions, except per share data; shares in thousands)

(unaudited)


		Quarter Ended				Nine Months Ended					Quarter Ended
		September 30,				September 30,					March 31,
		2020		2019		2020		2019				2021		2020
Revenues	Revenues									Revenues
Clearing and transaction fees	Clearing and transaction fees	$	835.4	$	1,040.7	$	3,054.4	$	3,045.1	Clearing and transaction fees		$	1,007.0	$	1,278.8
Market data and information services	Market data and information services	139.4		129.8		405.6		388.2		Market data and information services		144.2		131.5
Other	Other	105.9		106.8		325.1		296.3		Other		102.1		111.8
Total Revenues	Total Revenues	1,080.7		1,277.3		3,785.1		3,729.6		Total Revenues		1,253.3		1,522.1
Expenses	Expenses									Expenses
Compensation and benefits	Compensation and benefits	216.4		223.5		640.9		681.1		Compensation and benefits		225.0		207.5
Technology	Technology	48.1		52.7		144.9		148.4		Technology		48.2		47.7
Professional fees and outside services	Professional fees and outside services	48.4		43.2		141.3		124.3		Professional fees and outside services		37.4		41.7
Amortization of purchased intangibles	Amortization of purchased intangibles	78.3		79.8		232.2		236.6		Amortization of purchased intangibles		60.6		77.3
Depreciation and amortization	Depreciation and amortization	39.7		41.4		111.7		120.6		Depreciation and amortization		37.6		35.3
Licensing and other fee agreements	Licensing and other fee agreements	57.7		45.6		187.0		130.9		Licensing and other fee agreements		64.7		73.9
Other	Other	67.1		105.9		204.7		272.9		Other		54.7		78.8
Total Expenses	Total Expenses	555.7		592.1		1,662.7		1,714.8		Total Expenses		528.2		562.2
Operating Income	Operating Income	525.0		685.2		2,122.4		2,014.8		Operating Income		725.1		959.9

Non-Operating Income (Expense)	Non-Operating Income (Expense)									Non-Operating Income (Expense)
Investment income	Investment income	23.6		172.3		151.6		490.3		Investment income		30.9		95.9
Interest and other borrowing costs	Interest and other borrowing costs	(41.7)		(42.8)		(124.5)		(136.0)		Interest and other borrowing costs		(41.5)		(40.9)
Equity in net earnings of unconsolidated subsidiaries	Equity in net earnings of unconsolidated subsidiaries	44.0		48.0		144.0		132.3		Equity in net earnings of unconsolidated subsidiaries		56.2		51.2
Other non-operating income (expense)	Other non-operating income (expense)	(14.4)		(139.5)		(106.4)		(435.9)		Other non-operating income (expense)		(18.4)		(76.8)
Total Non-Operating Income (Expense)	Total Non-Operating Income (Expense)	11.5		38.0		64.7		50.7		Total Non-Operating Income (Expense)		27.2		29.4
Income before Income Taxes	Income before Income Taxes	536.5		723.2		2,187.1		2,065.5		Income before Income Taxes		752.3		989.3
Income tax provision	Income tax provision	125.0		86.9		505.5		418.7		Income tax provision		177.5		222.5
Net Income	Net Income	411.5		636.3		1,681.6		1,646.8		Net Income		574.8		766.8
Less: net (income) loss attributable to non-controlling interests	Less: net (income) loss attributable to non-controlling interests	0.2		0		(0.4)		0.2		Less: net (income) loss attributable to non-controlling interests		(0.4)		(0.6)
Net Income Attributable to CME Group	Net Income Attributable to CME Group	$	411.7	$	636.3	$	1,681.2	$	1,647.0	Net Income Attributable to CME Group		$	574.4	$	766.2

Earnings per Common Share Attributable to CME Group:	Earnings per Common Share Attributable to CME Group:									Earnings per Common Share Attributable to CME Group:
Basic	Basic	$	1.15	$	1.78	$	4.70	$	4.61	Basic		$	1.60	$	2.14
Diluted	Diluted	1.15		1.78		4.69		4.60		Diluted		1.60		2.14
Weighted Average Number of Common Shares:	Weighted Average Number of Common Shares:									Weighted Average Number of Common Shares:
Basic	Basic	357,791		357,211		357,669		357,054		Basic		358,147		357,524
Diluted	Diluted	358,590		358,369		358,492		358,201		Diluted		358,817		358,455

See accompanying notes to unaudited consolidated financial statements.

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CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

(unaudited)


		Quarter Ended				Nine Months Ended					Quarter Ended
		September 30,				September 30,					March 31,
		2020		2019		2020		2019				2021		2020
Net income	Net income	$	411.5	$	636.3	$	1,681.6	$	1,646.8	Net income		$	574.8	$	766.8
Other comprehensive income (loss), net of tax:	Other comprehensive income (loss), net of tax:									Other comprehensive income (loss), net of tax:
Investment securities:	Investment securities:									Investment securities:
Net unrealized holding gains (losses) arising during the period	Net unrealized holding gains (losses) arising during the period	0		(0.2)		0.8		1.5		Net unrealized holding gains (losses) arising during the period		(1.1)		(0.6)
Reclassification of net (gains) losses on sales included in investment income		0		(0.1)		0		(0.2)

Income tax benefit (expense)	Income tax benefit (expense)	0		0		(0.2)		(0.4)		Income tax benefit (expense)		0.3		0.2
Investment securities, net	Investment securities, net	0		(0.3)		0.6		0.9		Investment securities, net		(0.8)		(0.4)
Defined benefit plans:	Defined benefit plans:									Defined benefit plans:
Net change in defined benefit plans arising during the period	Net change in defined benefit plans arising during the period	0		0		(2.0)		(2.7)		Net change in defined benefit plans arising during the period		0		(2.0)
Amortization of net actuarial (gains) losses included in compensation and benefits expense	Amortization of net actuarial (gains) losses included in compensation and benefits expense	1.2		1.3		3.5		3.7		Amortization of net actuarial (gains) losses included in compensation and benefits expense		1.1		1.2
Income tax benefit (expense)	Income tax benefit (expense)	(0.3)		(0.4)		(0.4)		(0.3)		Income tax benefit (expense)		(0.3)		0.2
Defined benefit plans, net	Defined benefit plans, net	0.9		0.9		1.1		0.7		Defined benefit plans, net		0.8		(0.6)
Derivative investments:	Derivative investments:									Derivative investments:
Net unrealized holding gains (losses) arising during the period		0		0.5		0		0.3

Reclassification of net unrealized (gains) losses to interest expense and other non-operating income (expense)	Reclassification of net unrealized (gains) losses to interest expense and other non-operating income (expense)	(0.3)		(0.3)		(2.4)		(0.9)		Reclassification of net unrealized (gains) losses to interest expense and other non-operating income (expense)		(0.3)		(1.8)
Income tax benefit (expense)	Income tax benefit (expense)	0.2		(0.1)		0.6		0		Income tax benefit (expense)		0.1		0.4
Derivative investments, net	Derivative investments, net	(0.1)		0.1		(1.8)		(0.6)		Derivative investments, net		(0.2)		(1.4)
Foreign currency translation:	Foreign currency translation:									Foreign currency translation:
Foreign currency translation adjustments	Foreign currency translation adjustments	56.0		(35.5)		39.8		(38.5)		Foreign currency translation adjustments		(51.2)		(27.8)
Reclassification of net currency (gains) losses from foreign entities to other expenses	Reclassification of net currency (gains) losses from foreign entities to other expenses	0		0		0.6		0		Reclassification of net currency (gains) losses from foreign entities to other expenses		0		0.6
Income tax benefit (expense)		0		(3.0)		0		0

Foreign currency translation, net	Foreign currency translation, net	56.0		(38.5)		40.4		(38.5)		Foreign currency translation, net		(51.2)		(27.2)
Other comprehensive income (loss), net of tax	Other comprehensive income (loss), net of tax	56.8		(37.8)		40.3		(37.5)		Other comprehensive income (loss), net of tax		(51.4)		(29.6)
Comprehensive income	Comprehensive income	468.3		598.5		1,721.9		1,609.3		Comprehensive income		523.4		737.2
Less: comprehensive (income) loss attributable to non-controlling interests	Less: comprehensive (income) loss attributable to non-controlling interests	0.2		0		(0.4)		0.2		Less: comprehensive (income) loss attributable to non-controlling interests		(0.4)		(0.6)
Comprehensive income attributable to CME Group	Comprehensive income attributable to CME Group	$	468.5	$	598.5	$	1,721.5	$	1,609.5	Comprehensive income attributable to CME Group		$	523.0	$	736.6

See accompanying notes to unaudited consolidated financial statements.

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CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

(dollars in millions, except per share data; shares in thousands)

(unaudited)

Nine Months Ended, September 30, 2020
Class A
Common
Stock
(Shares) Class B
Common
Stock
(Shares) Common
Stock and
Additional
Paid-in
Capital Retained
Earnings Accumulated
Other
Comprehensive
Income (Loss) Total CME Group Shareholders' Equity Non-controlling Interest Total
Equity
Balance at December 31, 2019 357,469 3 $ 21,116.8 $ 5,008.7 $ 3.4 $ 26,128.9 $ 30.4 $ 26,159.3
Net income 1,681.2 1,681.2 0.4 1,681.6
Other comprehensive income (loss) 40.3 40.3 — 40.3
Dividends on common stock of $2.55 per share (914.5) (914.5) (914.5)
Impact of adoption of accounting standards updates on credit losses (0.3) (0.3) (0.3)
Exercise of stock options 108 6.0 6.0 6.0
Vesting of issued restricted Class A common stock 419 (37.1) (37.1) (37.1)
Shares issued to Board of Directors 17 2.9 2.9 2.9
Shares issued under Employee Stock Purchase Plan 17 2.9 2.9 2.9
Stock-based compensation 69.3 69.3 69.3
Balance at September 30, 2020 358,030 3 $ 21,160.8 $ 5,775.1 $ 43.7 $ 26,979.6 $ 30.8 $ 27,010.4



	Class A Common Stock (Shares)	Class B Common Stock (Shares)	Common Stock and Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total CME Group Shareholders' Equity		Non-controlling Interest		Total Equity
Balance at December 31, 2020	358,110	3	$	21,189.1	$	4,995.9	$	134.9	$	26,319.9	$	31.6	$	26,351.5
Net income					574.4				574.4		0.4		574.8
Other comprehensive income (loss)							(51.4)		(51.4)				(51.4)
Dividends on common stock of $0.90 per share					(323.0)				(323.0)				(323.0)

Purchase of non-controlling interest			(2.2)						(2.2)		(4.0)		(6.2)
Exercise of stock options	31		1.7						1.7				1.7
Vesting of issued restricted Class A common stock	99		(13.1)						(13.1)				(13.1)


Stock-based compensation			21.6						21.6				21.6
Balance at March 31, 2021	358,240	3	$	21,197.1	$	5,247.3	$	83.5	$	26,527.9	$	28.0	$	26,555.9

Table of Contents

CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY (continued)

(dollars in millions, except per share data; shares in thousands)

(unaudited)

Quarter Ended, September 30, 2020
Class A Common Stock (Shares) Class B Common Stock (Shares) Common Stock and Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total CME Group Shareholders' Equity Non-controlling Interest Total Equity
Balance at June 30, 2020 357,727 3 $ 21,152.5 $ 5,668.5 $ (13.1) $ 26,807.9 $ 31.0 $ 26,838.9
Net income 411.7 411.7 (0.2) 411.5
Other comprehensive income (loss) 56.8 56.8 — 56.8
Dividends on common stock of $0.85 per share (305.1) (305.1) (305.1)
Exercise of stock options 41 2.2 2.2 2.2
Vesting of issued restricted Class A common stock 262 (17.7) (17.7) (17.7)
Shares issued to Board of Directors 0 0 0
Shares issued under Employee Stock Purchase Plan 0 0 0
Stock-based compensation 23.8 23.8 23.8
Balance at September 30, 2020 358,030 3 $ 21,160.8 $ 5,775.1 $ 43.7 $ 26,979.6 $ 30.8 $ 27,010.4

~~See accompanying notes to unaudited consolidated financial statements.~~



	Class A Common Stock (Shares)	Class B Common Stock (Shares)	Common Stock and Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total CME Group Shareholders' Equity		Non-controlling Interest		Total Equity
Balance at December 31, 2019	357,469	3	$	21,116.8	$	5,008.7	$	3.4	$	26,128.9	$	30.4	$	26,159.3
Net income					766.2				766.2		0.6		766.8
Other comprehensive income (loss)							(29.6)		(29.6)				(29.6)
Dividends on common stock of $0.85 per share					(304.7)				(304.7)				(304.7)
Impact of adoption of accounting standards updates on credit losses					(0.3)				(0.3)				(0.3)

Exercise of stock options	55		3.2						3.2				3.2
Vesting of issued restricted Class A common stock	153		(19.1)						(19.1)				(19.1)


Stock-based compensation			23.1						23.1				23.1
Balance at March 31, 2020	357,677	3	$	21,124.0	$	5,469.9	$	(26.2)	$	26,567.7	$	31.0	$	26,598.7

Table of Contents

CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ~~EQUITY~~CASH FLOWS

(in millions)

(unaudited) ~~(continued)~~

~~(dollars in millions, except per share data; shares in thousands)~~

~~(unaudited)~~

Nine Months Ended, September 30, 2019
Class A
Common
Stock
(Shares) Class B
Common
Stock
(Shares) Common
Stock and
Additional
Paid-in
Capital Retained
Earnings Accumulated
Other
Comprehensive
Income (Loss) Total CME Group Shareholders' Equity Non-controlling Interest Total
Equity
Balance at December 31, 2018 356,824 3 $ 21,057.9 $ 4,855.3 $ 5.3 $ 25,918.5 $ 46.8 $ 25,965.3
Net income 1,647.0 1,647.0 (0.2) 1,646.8
Other comprehensive income (loss) (37.5) (37.5) (37.5)
Dividends on common stock of $2.25 per share (805.0) (805.0) (805.0)
Impact of adoption of standards updates on leasing 6.9 6.9 6.9
Changes in non-controlling interest due to measurement period 0 (16.5) (16.5)
Exercise of stock options 195 13.7 13.7 13.7
Vesting of issued restricted Class A common stock 399 (36.8) (36.8) (36.8)
Shares issued to Board of Directors 16 3.1 3.1 3.1
Shares issued under Employee Stock Purchase Plan 13 2.5 2.5 2.5
Stock-based compensation 70.8 70.8 70.8
Balance at September 30, 2019 357,447 3 $ 21,111.2 $ 5,704.2 $ (32.2) $ 26,783.2 $ 30.1 $ 26,813.3


	Quarter Ended March 31,
	2021		2020
Cash Flows from Operating Activities
Net income	$	574.8	$	766.8
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation	21.6		23.1
Amortization of purchased intangibles	60.6		77.3
Depreciation and amortization	37.6		35.3
Net losses on impaired assets	0		23.1
Net (gain) loss on derivative contracts	0		(1.5)
Net realized and unrealized (gains) on investments	(0.8)		(2.9)
Cash dividends in excess of earnings (undistributed net earnings) of unconsolidated subsidiaries	13.1		(0.2)
Deferred income taxes	(7.8)		(9.7)
Change in:
Accounts receivable	(146.2)		(309.5)
Other current assets	(30.5)		(14.5)
Other assets	12.3		18.8
Accounts payable	(8.7)		12.4
Income taxes payable	115.7		186.1
Other current liabilities	(32.3)		(22.1)
Other liabilities	(8.6)		(29.5)
Other	1.9		4.1
Net Cash Provided by Operating Activities	602.7		757.1

Cash Flows from Investing Activities
Proceeds from maturities of available-for-sale marketable securities	2.2		2.2
Purchases of available-for-sale marketable securities	(1.5)		(2.4)
Purchases of property, net	(28.5)		(42.8)


Purchase of non-controlling interest	(6.2)		0

Net Cash Used in Investing Activities	(34.0)		(43.0)

Cash Flows from Financing Activities
Repayment of commercial paper, net	0		(204.6)


Cash dividends	(1,217.5)		(1,197.6)


Employee taxes paid on restricted stock vesting	(13.1)		(19.1)
Other	(2.6)		7.4
Net Cash Used in Financing Activities	(1,233.2)		(1,413.9)

Table of Contents

~~CME GROUP INC. AND SUBSIDIARIES~~

~~CONSOLIDATED STATEMENTS OF EQUITY~~ ~~(continued)~~

~~(dollars in millions, except per share data; shares in thousands)~~

~~(unaudited)~~

Quarter Ended, September 30, 2019
Class A Common Stock (Shares) Class B Common Stock (Shares) Common Stock and Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total CME Group Shareholders' Equity Non-controlling Interest Total Equity
Balance at June 30, 2019 357,143 3 $ 21,112.8 $ 5,336.8 $ 5.6 $ 26,455.2 $ 29.7 $ 26,484.9
Net income 636.3 636.3 636.3
Other comprehensive income (loss) (37.8) (37.8) (37.8)
Dividends on common stock of $0.75 per share (268.9) (268.9) (268.9)
Changes in non-controlling interest due to measurement period 0.4 0.4
Exercise of stock options 33 6.7 6.7 6.7
Vesting of issued restricted Class A common stock 271 (22.7) (22.7) (22.7)
Stock-based compensation 14.4 14.4 14.4
Balance at September 30, 2019 357,447 3 $ 21,111.2 $ 5,704.2 $ (32.2) $ 26,783.2 $ 30.1 $ 26,813.3

~~See accompanying notes to unaudited consolidated financial statements.~~

~~Table of Contents~~

~~CME GROUP INC. AND SUBSIDIARIES~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(in millions)~~

~~(unaudited)~~

Nine Months Ended
September 30,
2020 2019
Cash Flows from Operating Activities
Net income $ 1,681.6 $ 1,646.8
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation 69.3 70.8
Amortization of purchased intangibles 232.2 236.6
Depreciation and amortization 111.7 120.6
Net losses on impaired assets 27.4 61.1
Net (gain) loss on derivative contracts (1.5) 17.9
Net realized and unrealized losses on investments 4.9 20.4
Undistributed net earnings of unconsolidated subsidiaries (9.7) (41.1)
Deferred income taxes (18.6) (23.7)
Change in:
Accounts receivable (0.8) 7.4
Other current assets (37.7) (106.5)
Other assets 45.1 (10.5)
Accounts payable 37.6 (54.4)
Income taxes payable (27.0) (94.5)
Other current liabilities (39.6) 91.9
Other liabilities (26.2) 1.0
Other 6.6 9.3
Net Cash Provided by Operating Activities 2,055.3 1,953.1
Cash Flows from Investing Activities
Proceeds from maturities of available-for-sale marketable securities 9.4 13.0
Purchases of available-for-sale marketable securities (8.7) (9.8)
Purchases of property, net (127.5) (179.2)
Investments in privately-held equity investments (5.5) 0
Proceeds from sales of investments 8.9 39.3
Net Cash Used in Investing Activities (123.4) (136.7)
Cash Flows from Financing Activities
Issuance of commercial paper, net of maturities (304.6) 38.9
Repayment of debt 0 (569.2)
Cash dividends (1,805.7) (1,427.8)
Settlement of derivative contracts 0 16.0
Employee taxes paid on restricted stock vesting (37.1) (36.8)
Other (3.8) 1.4
Net Cash Used in Financing Activities (2,151.2) (1,977.5)

~~Table of Contents~~

CME GROUP INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in millions)

(unaudited)


		Nine Months Ended September 30,					Quarter Ended March 31,
		2020		2019			2021		2020
Net change in cash, cash equivalents and restricted cash	Net change in cash, cash equivalents and restricted cash	$	(219.3)	$	(161.1)	Net change in cash, cash equivalents and restricted cash	$	(664.5)	$	(699.8)
Cash, cash equivalents and restricted cash, beginning of period	Cash, cash equivalents and restricted cash, beginning of period	1,556.6		1,377.2		Cash, cash equivalents and restricted cash, beginning of period	1,638.5		1,556.6
Cash, Cash Equivalents and Restricted Cash, End of Period	Cash, Cash Equivalents and Restricted Cash, End of Period	$	1,337.3	$	1,216.1	Cash, Cash Equivalents and Restricted Cash, End of Period	$	974.0	$	856.8

Reconciliation of cash, cash equivalents and restricted cash:	Reconciliation of cash, cash equivalents and restricted cash:					Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents	Cash and cash equivalents	$	1,332.1	$	1,210.1	Cash and cash equivalents	$	936.4	$	851.7
Cash classified as assets held for sale						Cash classified as assets held for sale	30.0		0
Short-term restricted cash	Short-term restricted cash	4.5		5.1		Short-term restricted cash	4.5		4.3
Long-term restricted cash	Long-term restricted cash	0.7		0.9		Long-term restricted cash	3.1		0.8
Total	Total	$	1,337.3	$	1,216.1	Total	$	974.0	$	856.8

Supplemental Disclosure of Cash Flow Information	Supplemental Disclosure of Cash Flow Information					Supplemental Disclosure of Cash Flow Information
Income taxes paid	Income taxes paid	$	553.2	$	550.6	Income taxes paid	$	65.8	$	39.0
Interest paid	Interest paid	109.4		122.4		Interest paid	42.4		42.4

See accompanying notes to unaudited consolidated financial statements.

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Table of Contents

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The consolidated financial statements consist of CME Group Inc. (CME Group) and its subsidiaries (collectively, the company), including Chicago Mercantile Exchange Inc. (CME), Board of Trade of the City of Chicago, Inc. (CBOT), New York Mercantile Exchange, Inc. (NYMEX), Commodity Exchange, Inc. (COMEX) and NEX Group Limited (NEX). The clearing house is operated by CME.

The accompanying interim consolidated financial statements have been prepared by CME Group without audit. Certain notes and other information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted. In the opinion of management, the accompanying consolidated financial statements include all normal recurring adjustments considered necessary to present fairly the financial position of the company at ~~September 30, 2020~~March 31, 2021 and December 31, ~~2019~~2020 and the results of operations and cash flows for the periods indicated. Quarterly results are not necessarily indicative of results for any subsequent period.

The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto in CME Group’s Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, filed with the Securities and Exchange Commission (SEC) on February ~~28, 2020.~~26, 2021.

2. ~~Accounting Policies~~

~~Newly Adopted Accounting Policies.~~ ~~The company adopted the following accounting policies during 2020:~~

~~Credit Losses.~~ In June 2016, the FASB issued guidance that changes how credit losses are measured for most financial assets measured at amortized cost and certain other instruments. The standard requires an entity to estimate its lifetime expected credit loss and record an allowance, that when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. This forward-looking expected loss model generally will result in the earlier recognition of allowances for losses. The standard also amends the impairment model for available for sale debt securities and requires entities to determine whether all or a portion of the unrealized loss on an available for sale debt security is a credit loss. Severity and duration of the unrealized loss are no longer permissible factors in concluding whether a credit loss exists. Entities will recognize improvements to estimated credit losses on available for sale debt securities immediately in earnings rather than as interest income over time. The company implemented this standard on January 1, 2020 by recognizing an immaterial cumulative-effect adjustment to the beginning balance of retained earnings.

The company has not experienced significant levels of underpayment or nonpayment by customers and does not expect changes to this trend over the payment terms of our receivables. Exposure to losses on receivables for clearing and transaction fees and other amounts owed by clearing and trading firms is dependent on each firm's financial condition. With respect to clearing firms, the company's credit loss exposure is mitigated by the memberships that collateralize fees owed to the company. The allowance for credit losses on accounts receivable is calculated by evaluating the aging of the company's billings by revenue stream: clearing and transaction, market data, and other. This aging assessment, as well as contemplation of current and anticipated economic factors, including the interest rate environment and pricing levels are the primary considerations that most significantly impact the collectibility of accounts receivable. The allowance for accounts receivable is $4.8 million at September 30, 2020.

~~Income Taxes.~~ In December 2019, the FASB issued an accounting update that is intended to reduce cost and complexity related to accounting for income taxes. The update removes specific exceptions to the general principles for accounting for income taxes. Specifically, it eliminates the need for an entity to analyze whether the following exceptions apply in a given period: incremental approach for intraperiod tax allocation, accounting basis differences when there are ownership changes in foreign investments, and interim period income tax accounting for year-to-date losses that exceed anticipated losses. The update also simplifies the accounting for the following: franchise taxes that are partially based on income, transactions with a government that result in a step up in the tax basis of goodwill, separate financial statements of legal entities that are not subject to tax, and enacted changes in tax laws in interim periods. This update is effective for reporting periods beginning after December 15, 2020. The company has early adopted this standard on January 1, 2020. The impact of adoption of this standard was immaterial to the consolidated financial statements.

~~Recently Issued Accounting Pronouncements.~~ In August 2018, the FASB issued a standards update that modifies the disclosure requirements for employers that sponsor defined pension or other postretirement plans. The guidance clarifies certain existing disclosures and expands the requirements for others. Disclosures that are not considered cost beneficial are removed by the update. Also, there is a new disclosure requirement to include an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period. This guidance is effective for reporting periods beginning in 2021. Early adoption is permitted. The company plans to update the disclosures for these changes upon adoption of the guidance in 2021.

~~Table of Contents~~

3. Revenue Recognition

The company generates revenue from customers from the following sources:

Clearing and transaction fees. Clearing and transaction fees include electronic trading fees and brokerage commissions, surcharges for privately-negotiated transactions, portfolio reconciliation and compression services, risk mitigation and other volume-related charges for trade contracts. Clearing and transaction fees are assessed upfront at the time of trade execution. As such, the company recognizes the majority of the fee revenue upon successful execution of the trade. The minimal remaining portion of the fee revenue related to settlement activities performed after trade execution is recognized over the short-term period that the contract is outstanding, based on management’s estimates of the average contract lifecycle. These estimates are based on various assumptions to approximate the amount of fee revenue to be attributed to services performed through contract settlement, expiration, or termination. For cleared trades, these assumptions include the average number of days that a contract remains in open interest, contract turnover, average revenue per day, and revenue remaining in open interest at the end of each period.

The nature of contracts gives rise to several types of variable consideration, including volume-based pricing tiers, customer incentives associated with market maker programs and other fee discounts. The company includes fee discounts and incentives in the estimated transaction price when there is a basis to reasonably estimate the amount of the fee reduction. These estimates are based on historical experience, anticipated performance, and best judgment at the time. Because of the company's certainty in estimating these amounts, they are included in the transaction price of contracts.

Market data and information services. Market data and information services represent revenue from the dissemination of market data to subscribers, distributors, and other third-party licensees of market data. Pricing for market data is primarily based on the number of reportable devices used as well as the number of subscribers enrolled under the arrangement. Fees for these services are generally billed monthly. Market data services are satisfied over time and revenue is recognized on a monthly basis as the customers receive and consume the benefit of the market data services. However, the company also maintains certain annual license arrangements with one-time upfront fees. The fees for annual licenses are initially recorded as a contract liability and recognized as revenue monthly over the term of the annual period.

Other. Other revenues include certain access and communication fees, fees for collateral management, equity membership subscription fees, and fees for trade order routing through agreements from various strategic relationships. Access and communication fees are charges to customers that utilize various telecommunications networks and communications services. Fees for these services are generally billed monthly and the associated fee revenue is recognized as billed. Collateral management fees are charged to clearing firms that have collateral on deposit with the clearing house to meet their minimum performance bond and guaranty fund obligations on the exchange. These fees are calculated based on daily collateral balances and are billed monthly. This fee revenue is recognized monthly as billed as the customers receive and consume the benefits of the services. WeThe company also ~~have~~has an equity membership program which provides equity members the option to substitute a monthly subscription fee for their existing requirement to hold CME Group Class A common stock. Choosing to pay this fee in lieu of holding Class A shares is entirely voluntary and the client's choice. Fee revenue under this program is earned monthly as billed over the contractual term. Pricing for strategic relationships may be driven by customer levels and activity. There are fee arrangements which provide for monthly as well as quarterly payments in arrears. Revenue is recognized monthly for strategic relationship arrangements as the customers receive and consume the benefits of the services.

1512

Table of Contents

The following table represents a disaggregation of revenue from contracts with customers by product line for the quarters ended March 31, 2021 and ~~nine months ended September 30, 2020 and 2019:~~2020:


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Interest rates	Interest rates	$	172.0	$	347.9	$	811.5	$	998.1	Interest rates		$	299.7	$	418.3
Equity indexes	Equity indexes	181.8		153.9		631.4		447.9		Equity indexes		198.5		248.2
Foreign exchange	Foreign exchange	40.5		39.2		124.6		119.7		Foreign exchange		40.5		48.2
Agricultural commodities	Agricultural commodities	112.8		104.2		339.2		350.7		Agricultural commodities		120.5		117.7
Energy	Energy	138.8		178.7		554.6		523.0		Energy		158.1		221.8
Metals	Metals	69.1		74.3		197.5		183.4		Metals		58.3		78.8
Cash markets business	Cash markets business	105.6		124.9		342.4		368.5		Cash markets business		115.1		124.4
Interest rate swap	Interest rate swap	14.8		17.6		53.2		53.8		Interest rate swap		16.3		21.4
Total clearing and transaction fees	Total clearing and transaction fees	835.4		1,040.7		3,054.4		3,045.1		Total clearing and transaction fees		1,007.0		1,278.8
Market data and information services	Market data and information services	139.4		129.8		405.6		388.2		Market data and information services		144.2		131.5
Other	Other	105.9		106.8		325.1		296.3		Other		102.1		111.8
Total revenues	Total revenues	$	1,080.7	$	1,277.3	$	3,785.1	$	3,729.6	Total revenues		$	1,253.3	$	1,522.1

Timing of Revenue Recognition	Timing of Revenue Recognition									Timing of Revenue Recognition
Services transferred at a point in time	Services transferred at a point in time	$	827.3	$	973.3	$	2,919.8	$	2,854.3	Services transferred at a point in time		$	945.1	$	1,211.2
Services transferred over time	Services transferred over time	250.3		301.6		856.6		861.2		Services transferred over time		305.2		307.5
One-time charges and miscellaneous revenues	One-time charges and miscellaneous revenues	3.1		2.4		8.7		14.1		One-time charges and miscellaneous revenues		3.0		3.4
Total revenues	Total revenues	$	1,080.7	$	1,277.3	$	3,785.1	$	3,729.6	Total revenues		$	1,253.3	$	1,522.1

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, and customer advances and deposits (contract liabilities) on the consolidated balance sheets. Certain fees for transactions, annual licenses, and other revenue arrangements are billed upfront before revenue is recognized, which results in the recognition of contract liabilities. These liabilities are recognized on the consolidated balance sheets on a contract-by-contract basis atupon commencement of services under the ~~end of each reporting period. For annual licenses and~~customer contract. These upfront ~~fee arrangements, the company generally bills customers upon contract execution. These~~customer payments are recognized as revenue over time as the obligations under the contracts are satisfied. Changes in the contract liability balances during the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 were not materially impacted by any other factors. The balance of contract liabilities was $~~48.2~~62.8 million and ~~$42.6~~$37.3 million as of ~~September 30, 2020~~March 31, 2021 and December 31, ~~2019,~~2020, respectively.

3. Assets and Liabilities Held for Sale

On January 12, 2021, the company announced that it has agreed with IHS Markit to combine their post-trade services into a new joint venture. The new company will perform trade processing and risk mitigation services. The company will contribute it's optimization business, which includes Traiana, TriOptima and Reset, to the new joint venture for an equity interest in the new company. The transaction is expected to close in mid-2021, subject to customary antitrust and regulatory approvals and other customary closing conditions.

In January 2021, the net assets that will be contributed to the joint venture were classified as held for sale following approval of the transaction by the company's Board of Directors. The reclassification of the assets and liabilities to held for sale did not have an impact on earnings.

4. Performance Bonds and Guaranty Fund Contributions

Performance Bonds and Guaranty Fund Contributions. At September 30, 2020, performance bonds and guaranty fund contribution assets on the consolidated balance sheets include cash as well as U.S. Treasury securities and U.S. government agency securities. U.S. Treasury securities and U.S. government agency securities are purchased by CME, at its discretion, using cash collateral. The benefits, including interest earned, and risks of ownership accrue to CME. Interest earned is included in investment income on the consolidated statements of income. These debt securities are classified as available-for-sale. At September 30, 2020, the amortized cost and fair value of the U.S. Treasury securities were both $800.0 million. At September 30, 2020, the amortized cost and fair value of the U.S. government agency securities were both $195.0 million.

CME has been designated as a systemically important financial market utility by the Financial Stability Oversight Council and is authorized to ~~establish and~~ maintain a cash ~~account~~accounts at the Federal Reserve Bank of Chicago. At ~~September 30, 2020,~~March 31, 2021, CME maintained ~~$70.6~~$111.5 billion within the cash account at the Federal Reserve Bank of Chicago. The cash deposit at the Federal Reserve Bank of Chicago is included within performance bonds and guaranty fund contributions on the consolidated balance sheets.

Clearing House Contract Settlement. The clearing house marks-to-market open positions for all futures and options contracts twice a day (once a day for CME's cleared-only interest rate swap contracts). Based on values derived from the mark-to-market process, the clearing house requires payments from clearing firms whose positions have lost value and makes payments to clearing firms whose positions have gained value. Under the extremely unlikely scenario of simultaneous default by every

Table of Contents

clearing firm who has open positions with unrealized losses, the maximum exposure related to positions other than cleared-only

~~Table of Contents~~

interest rate swap contracts would be one half day of changes in fair value of all open positions, before considering the clearing house's ability to access defaulting clearing firms' collateral deposits.

For CME's cleared-only interest rate swap contracts, the maximum exposure related to CME's guarantee would be one full day of changes in fair value of all open positions, before considering CME's ability to access defaulting clearing firms' collateral.

During the first ~~nine months~~quarter of ~~2020,~~2021, the clearing house transferred an average of approximately ~~$5.1~~$4.6 billion a day through its clearing systems for settlement from clearing firms whose positions had lost value to clearing firms whose positions had gained value. The clearing house reduces its guarantee exposure through initial and maintenance performance bond requirements and mandatory guaranty fund contributions. ~~The company believes that its~~Management has assessed the fair value of the company's settlement guarantee liability ~~is immaterial~~by taking the following factors into consideration: the design and operations of the clearing risk management process, the financial safeguard packages in place, historical evidence of default by a clearing member and the estimated probability of potential payouts by the clearing house. Based on the assessment performed, management estimates the guarantee liability to be nominal and therefore has not recorded any liability at ~~September 30, 2020.~~March 31, 2021. The company does not have a history of significant losses recognized on performance bond collateral as posted by our clearing members, and management currently does not anticipate any future credit losses on its performance bond assets. Accordingly, the company has not provided an allowance for credit losses on these performance bond deposits, nor ~~have we~~has it recorded any liabilities to reflect an allowance for credit losses related to our off-balance sheet credit exposures and guarantees.

5. Intangible Assets and Goodwill

In January 2021, the net assets that will be contributed to a joint venture with IHS Markit were classified as held for sale. As a result, $1.1 billion of amortizable intangible assets were reclassified to assets held for sale on the consolidated balance sheet. Amortization expense is no longer taken on these intangible assets once reclassified to assets held for sale.

Intangible assets consisted of the following at ~~September 30, 2020~~March 31, 2021 and December 31, ~~2019:~~2020:


		September 30, 2020						December 31, 2019							March 31, 2021								December 31, 2020
(in millions)	(in millions)	Assigned Value		Accumulated Amortization		Net Book Value		Assigned Value		Accumulated Amortization		Net Book Value		(in millions)	Assigned Value		Reclassified as Held for Sale		Accumulated Amortization		Net Book Value		Assigned Value		Accumulated Amortization		Net Book Value
Amortizable Intangible Assets:	Amortizable Intangible Assets:													Amortizable Intangible Assets:
Clearing firm, market data and other customer relationships	Clearing firm, market data and other customer relationships	$	5,806.7	$	(1,555.5)	$	4,251.2	$	5,797.1	$	(1,346.0)	$	4,451.1	Clearing firm, market data and other customer relationships	$	5,822.7	$	(946.7)	$	(1,684.0)	$	3,192.0	$	5,858.0	$	(1,632.5)	$	4,225.5

Technology-related intellectual property	Technology-related intellectual property	174.5		(61.9)		112.6		174.3		(46.6)		127.7		Technology-related intellectual property	174.8		(84.3)		(69.6)		20.9		178.4		(68.2)		110.2
Other	Other	103.6		(23.6)		80.0		103.8		(14.9)		88.9		Other	106.4		(23.1)		(29.4)		53.9		106.9		(27.3)		79.6
Total amortizable intangible assets	Total amortizable intangible assets	$	6,084.8	$	(1,641.0)	4,443.8		$	6,075.2	$	(1,407.5)	4,667.7		Total amortizable intangible assets	$	6,103.9	$	(1,054.1)	$	(1,783.0)	3,266.8		$	6,143.3	$	(1,728.0)	4,415.3

Indefinite-Lived Intangible Assets:	Indefinite-Lived Intangible Assets:													Indefinite-Lived Intangible Assets:
Trade names	Trade names					450.0						450.0		Trade names							450.0						450.0
Total intangible assets – other, net	Total intangible assets – other, net					$	4,893.8					$	5,117.7	Total intangible assets – other, net							$	3,716.8					$	4,865.3
Trading products (1)	Trading products (1)					$	17,175.3					$	17,175.3	Trading products (1)							$	17,175.3					$	17,175.3

(1)Trading products represent futures and options products acquired in our business combinations with CBOT Holdings, Inc., NYMEX Holdings, Inc. and The Board of Trade of Kansas City, Missouri, Inc. Clearing and transaction fees are generated through the trading of these products. These trading products, most of which have traded for decades, require authorization from the Commodity Futures Trading Commission (CFTC). Product authorizations from the CFTC have no term limits.

Total amortization expense for intangible assets was ~~$78.3~~$60.6 million and ~~$79.8~~$77.3 million for the quarters ended ~~September 30,~~March 31, 2021 and 2020, ~~and 2019,~~ respectively. ~~Total amortization expense for intangible assets was $232.2 million and $236.6 million for the nine months ended September 30, 2020 and 2019, respectively.~~

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As of ~~September 30, 2020,~~March 31, 2021, the future estimated amortization expense related to amortizable intangible assets is expected to be as follows:


(in millions)	(in millions)	Amortization Expense		(in millions)	Amortization Expense
Remainder of 2020		$	78.2
2021		312.8
Remainder of 2021				Remainder of 2021	$	174.8
2022	2022	312.4		2022	233.1
2023	2023	311.0		2023	231.7
2024	2024	304.3		2024	225.0
2025	2025	304.1		2025	225.0
2026				2026	225.0
Thereafter	Thereafter	2,821.0		Thereafter	1,952.2

Goodwill activity consisted of the following for the periods ended March 31, 2021 and December 31, 2020:


(in millions)	Balance at December 31, 2020		Reclassified as Held for Sale		Other Activity (1)		Balance at March 31, 2021
CBOT Holdings	$	5,066.4	$	0	$	0	$	5,066.4
NYMEX Holdings	2,462.2		0		0		2,462.2
NEX	3,229.8		(246.1)		(18.4)		2,965.3
Other	40.4		0		0		40.4
Total Goodwill	$	10,798.8	$	(246.1)	$	(18.4)	$	10,534.3
(in millions)	Balance at December 31, 2019		Reclassified as Held for Sale		Other Activity (1)		Balance at December 31, 2020
CBOT Holdings	$	5,066.4	$	0	$	0	$	5,066.4
NYMEX Holdings	2,462.2		0		0		2,462.2
NEX	3,173.5		0		56.3		3,229.8
Other	40.4		0		0		40.4
Total Goodwill	$	10,742.5	$	0	$	56.3	$	10,798.8

__________

~~Table of Contents~~1) Other activity includes currency translation adjustments.

6. Debt

Long-term debt consisted of the following at ~~September 30, 2020~~March 31, 2021 and December 31, ~~2019:~~2020:


(in millions)	(in millions)	September 30, 2020		December 31, 2019		(in millions)	March 31, 2021		December 31, 2020
$750.0 million fixed rate notes due September 2022, stated rate of 3.00% (1)	$750.0 million fixed rate notes due September 2022, stated rate of 3.00% (1)	$	748.3	$	747.7	$750.0 million fixed rate notes due September 2022, stated rate of 3.00% (1)	$	748.8	$	748.6
€15.0 million fixed rate notes due May 2023, stated rate of 4.30%	€15.0 million fixed rate notes due May 2023, stated rate of 4.30%	17.2		16.4		€15.0 million fixed rate notes due May 2023, stated rate of 4.30%	17.3		18.1
$750.0 million fixed rate notes due March 2025, stated rate of 3.00% (2)	$750.0 million fixed rate notes due March 2025, stated rate of 3.00% (2)	746.8		746.3		$750.0 million fixed rate notes due March 2025, stated rate of 3.00% (2)	747.2		747.0
$500.0 million fixed rate notes due June 2028, stated rate of 3.75%	$500.0 million fixed rate notes due June 2028, stated rate of 3.75%	496.7		496.4		$500.0 million fixed rate notes due June 2028, stated rate of 3.75%	496.9		496.8
$750.0 million fixed rate notes due September 2043, stated rate of 5.30% (3)	$750.0 million fixed rate notes due September 2043, stated rate of 5.30% (3)	743.0		742.8		$750.0 million fixed rate notes due September 2043, stated rate of 5.30% (3)	743.1		743.1
$700.0 million fixed rate notes due June 2048, stated rate of 4.15%	$700.0 million fixed rate notes due June 2048, stated rate of 4.15%	690.2		689.8		$700.0 million fixed rate notes due June 2048, stated rate of 4.15%	690.3		690.2
Commercial paper (4)		0		303.8
Total long-term debt	Total long-term debt	$	3,442.2	$	3,743.2	Total long-term debt	$	3,443.6	$	3,443.8

(1)The company maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 3.32%.

(2)The company maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 3.11%.

(3)The company maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 4.73%.

~~(4)The commercial paper is backed by the five-year multi-currency revolving credit facility, which expires in 2022.~~

~~Commercial paper with an aggregate par value~~

Table of $1.3 billion and maturities ranging from 1 to 18 days was issued during the first nine months of 2020. The weighted average balance of commercial paper outstanding during the first nine months of 2020 was $62.0 million.Contents

Long-term debt maturities, at par value (in U.S. dollar equivalent), were as follows at ~~September 30, 2020:~~March 31, 2021:


(in millions)	(in millions)	Par Value		(in millions)	Par Value
2021		$	0
2022	2022	750.0		2022	$	750.0
2023	2023	17.6		2023	17.6
2024	2024	0		2024	0
2025	2025	750.0		2025	750.0
2026				2026	0
Thereafter	Thereafter	1,950.0		Thereafter	1,950.0

7. Contingencies

Legal and Regulatory ~~Matters~~Matters.. In 2013, the CFTC filed suit against NYMEX and two former employees (the NYMEX Defendants) alleging disclosure of confidential customer information in violation of the Commodity Exchange Act. On June 3, 2020, the parties informed the United States District Court for the Southern District of New York that the CFTC's Division of Enforcement and the NYMEX Defendants had reached an agreement in principle to resolve the matter, subject to final approval by the CFTC. On July 31, 2020, the parties informed the Court that the CFTC had approved the agreed-upon settlement and further requested that the court enter an order implementing the agreed-upon resolution. The Court approved the settlement on August 3, 2020, concluding the matter.

In 2003, the U.S. Futures Exchange, L.L.C. (Eurex U.S.) and U.S. Exchange Holdings, Inc. filed suit in federal court alleging that CBOT and CME violated the antitrust laws and tortuously interfered with the business relationship and contract between Eurex U.S. and The Clearing Corporation. On October 31, 2018, the district court granted CBOT's and CME's motion for summary judgment and dismissed the case in its entirety. On March 23, 2020, the Seventh Circuit affirmed the decision of the district court. Eurex U.S. and U.S. Exchange Holdings, Inc. did not file a petition for certiorari with the United States Supreme Court by the September 18, 2020 deadline, concluding the matter.

In the normal course of business, the company discusses matters with its regulators raised during regulatory examinations or otherwise subject to their inquiry and oversight. These matters could result in censures, fines, penalties or other sanctions. Management believes the outcome of any resulting actions will not have a material impact on its consolidated financial position or results of operations. However, the company is unable to predict the outcome or the timing of the ultimate resolution of these matters, or the potential fines, penalties or injunctive or other equitable relief, if any, that may result from these matters.

In addition, the company is a defendant in, and has potential for, various other legal proceedings arising from its regular business activities. While the ultimate results of such proceedings against the company cannot be predicted with certainty, the

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company believes that the resolution of any of these matters on an individual or aggregate basis will not have a material impact on its ~~consolidated~~consolidated financial position or results of operations.

~~As of September 30, 2020, an accrual of $2.1 million was recognized for probable and estimable legal and regulatory issues.~~ No accrual was required for legal and regulatory matters as none were probable and estimable as of March 31, 2021 and December 31, ~~2019.~~2020.

Intellectual Property Indemnifications. Certain agreements with customers and other third parties related to accessing the CME Group platforms, utilizing market data services and licensing CME SPAN software may contain indemnifications from intellectual property claims that may be made against them as a result of their use of the applicable products and/or services. The potential future claims relating to these indemnifications cannot be estimated and therefore no liability has been recorded.

8. Leases

The company has operating leases for ~~datacenters,~~ corporate ~~offices, and certain information technology equipment.~~offices. The operating leases have remaining lease terms of up to 1817 years, some of which include options to extend or renew the leases for up to an additional 5 years, and some of which include options to early terminate the leases in less than 12 months. Management evaluates ~~the exercisability of~~whether these options are exercisable at least quarterly in order to determine whether the contract term must be reassessed. For a small number of the leases, primarily the international locations, management's approach is to enter into short-term leases for a lease term of 12 months or less in order to provide for greater flexibility in the local environment. For certain office spaces, the company has entered into arrangements to sublease excess space to third parties, while the original lease contract remains in effect with the landlord.

The company also has one finance lease, which is related to the sale of our ~~datacenter~~data center in March 2016. In connection with the sale, the company leased back a portion of the property. The sale leaseback transaction was recognized under the financing method and not as a sale leaseback arrangement.

The right-of-use lease asset is recorded within other assets, and the present value of the lease liability is recorded within other liabilities (segregated between short term and long term) on the consolidated balance sheets. The discount rate applied to the lease payments represents the company's incremental borrowing rate.

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The components of lease costs were as follows:


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)		2021		2020
Operating lease expense:	Operating lease expense:									Operating lease expense:
Operating lease cost	Operating lease cost	$	17.7	$	16.2	$	49.0	$	53.5	Operating lease cost		$	16.8	$	14.9
Short-term lease cost	Short-term lease cost	0.2		0.7		0.9		5.6		Short-term lease cost		0.2		0.2
Total operating lease expense included in other expense	Total operating lease expense included in other expense	$	17.9	$	16.9	$	49.9	$	59.1	Total operating lease expense included in other expense		$	17.0	$	15.1

Finance lease expense:	Finance lease expense:									Finance lease expense:
Interest expense	Interest expense	$	0.8	$	0.9	$	2.5	$	2.7	Interest expense		$	0.8	$	0.9
Depreciation expense	Depreciation expense	2.2		2.5		6.5		7.1		Depreciation expense		2.2		2.2
Total finance lease expense	Total finance lease expense	$	3.0	$	3.4	$	9.0	$	9.8	Total finance lease expense		$	3.0	$	3.1

Sublease revenue included in other revenue	Sublease revenue included in other revenue	$	3.4	$	2.0	$	10.1	$	7.3	Sublease revenue included in other revenue		$	2.5	$	3.6

Supplemental cash flow information related to leases was as follows:

Quarter Ended
September 30, Nine Months Ended
September 30,
(in millions) 2020 2019 2020 2019
Cash outflows for operating leases $ 16.4 $ 18.7 $ 48.0 $ 50.8
Cash outflows for finance leases 4.3 5.1 12.7 14.1

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	Quarter Ended March 31,
(in millions)		2021		2020
Cash outflows for operating leases		$	15.3	$	15.9
Cash outflows for finance leases		4.2		4.2

Supplemental balance sheet information related to leases was as follows:

Operating leases


(in millions)	(in millions)	September 30, 2020			December 31, 2019			(in millions)	March 31, 2021			December 31, 2020
Operating lease right-of-use assets	Operating lease right-of-use assets	$	401.3		$	417.1		Operating lease right-of-use assets	$	386.5		$	390.3

Operating lease liabilities:	Operating lease liabilities:							Operating lease liabilities:
Other current liabilities	Other current liabilities	$	42.6		$	42.3		Other current liabilities	$	47.3		$	44.5
Other liabilities	Other liabilities	496.1			514.8			Other liabilities	491.3			492.2
Total operating lease liabilities	Total operating lease liabilities	$	538.7		$	557.1		Total operating lease liabilities	$	538.6		$	536.7

Weighted average remaining lease term (in months)	Weighted average remaining lease term (in months)	140			146			Weighted average remaining lease term (in months)	137			138
Weighted average discount rate	Weighted average discount rate	3.9		%	4.0		%	Weighted average discount rate	3.9		%	3.9		%

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Finance leases


(in millions)	(in millions)	September 30, 2020			December 31, 2019			(in millions)	March 31, 2021			December 31, 2020
Finance lease right-of-use assets	Finance lease right-of-use assets	$	91.0		$	97.5		Finance lease right-of-use assets	$	86.7		$	88.8

Finance lease liabilities:	Finance lease liabilities:							Finance lease liabilities:
Other current liabilities	Other current liabilities	$	7.6		$	7.4		Other current liabilities	$	7.7		$	7.7
Other liabilities	Other liabilities	85.8			91.5			Other liabilities	81.9			83.8
Total finance lease liabilities	Total finance lease liabilities	$	93.4		$	98.9		Total finance lease liabilities	$	89.6		$	91.5

Weighted average remaining lease term (in months)	Weighted average remaining lease term (in months)	126			135			Weighted average remaining lease term (in months)	120			123
Weighted average discount rate	Weighted average discount rate	3.5		%	3.5		%	Weighted average discount rate	3.5		%	3.5		%

Future minimum lease payments were as follows as of ~~September 30, 2020~~March 31, 2021 for operating and finance leases:


(in millions)	(in millions)	Operating Leases		(in millions)	Operating Leases
Remainder of 2020		$	16.2
2021		63.6
Remainder of 2021				Remainder of 2021	$	49.7
2022	2022	66.9		2022	69.7
2023	2023	65.1		2023	68.0
2024	2024	59.2		2024	61.7
2025	2025	56.6		2025	58.8
2026				2026	54.3
Thereafter	Thereafter	344.7		Thereafter	306.7
Total lease payments	Total lease payments	672.3		Total lease payments	668.9
Less: imputed interest	Less: imputed interest	(133.6)		Less: imputed interest	(130.3)
Present value of lease liability	Present value of lease liability	$	538.7	Present value of lease liability	$	538.6

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(in millions)	(in millions)	Finance Leases		(in millions)	Finance Leases
Remainder of 2020		$	4.2
2021		17.0
Remainder of 2021				Remainder of 2021	$	12.7
2022	2022	17.1		2022	17.1
2023	2023	17.2		2023	17.2
2024	2024	17.4		2024	17.4
2025	2025	17.5		2025	17.5
2026				2026	17.6
Thereafter	Thereafter	94.3		Thereafter	76.7
Total lease payments	Total lease payments	184.7		Total lease payments	176.2
Less: imputed interest	Less: imputed interest	(91.3)		Less: imputed interest	(86.6)
Present value of lease liability	Present value of lease liability	$	93.4	Present value of lease liability	$	89.6

9. Guarantees

Mutual Offset Agreement. CME and Singapore Exchange Limited (SGX) maintain a mutual offset agreement with a current term through May 2023. This agreement enables market participants to open a futures position on one exchange and liquidate it on the other. The term of the agreement will automatically renew for a 1-year period after May 2023 unless either party provides advance notice of their intent to terminate. CME can maintain collateral in the form of irrevocable, standby letters of credit. At ~~September 30, 2020,~~March 31, 2021, CME was contingently liable to SGX on letters of credit totaling $310.0 million. CME also maintains a $350.0 million line of credit to meet its obligations under this agreement. Regardless of the collateral, CME guarantees all cleared transactions submitted through SGX and would initiate procedures designed to satisfy these financial obligations in the event of a default, such as the use of performance bonds and guaranty fund contributions of the defaulting clearing firm. ~~The company believes that its~~Management has assessed the fair value of the company's guarantee liability ~~is immaterial~~under this mutual offset agreement by taking the following factors into consideration: the design and operations of the clearing risk management process, the financial safeguard packages in place, historical evidence of default by a clearing member and the estimated probability of

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potential payouts by the clearing house. Based on the assessment performed, management estimates the guarantee liability to be nominal and therefore has not recorded any liability at ~~September 30, 2020.~~March 31, 2021.

Family Farmer and Rancher Protection Fund. In 2012, the company established the Family Farmer and Rancher Protection Fund (the Fund). The Fund is designed to provide payments, up to certain maximum levels, to family farmers, ranchers and other agricultural industry participants who use the company's agricultural commodity products and who suffer losses to their segregated account balances due to their CME clearing member becoming insolvent. Under the terms of the Fund, farmers and ranchers are eligible for up to $25,000 per participant. Farming and ranching cooperatives are eligible for up to $100,000 per cooperative. The Fund was established with a maximum of $100.0 million available for distribution to participants. Since its establishment, the Fund has made payments of approximately $2.0 million, which leaves $98.0 million available for future claims. If, at any time, payments due to participants were to exceed the amount remaining in the fund, payments would be pro-rated. Clearing members and customers must register with the company in advance and provide certain documentation in order to substantiate their eligibility. The company believes that its guarantee liability is ~~immaterial~~nominal and therefore has not recorded any liability at ~~September 30, 2020.~~March 31, 2021.

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10. Accumulated Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income (loss), including current period other comprehensive income (loss) and reclassifications out of accumulated other comprehensive income (loss):


(in millions)	(in millions)	Investment Securities		Defined Benefit Plans		Derivative Investments		Foreign Currency Translation		Total		(in millions)	Investment Securities		Defined Benefit Plans		Derivative Investments		Foreign Currency Translation		Total
Balance at December 31, 2019		$	0.8	$	(55.1)	$	69.0	$	(11.3)	$	3.4
Balance at December 31, 2020												Balance at December 31, 2020	$	1.6	$	(57.1)	$	67.0	$	123.4	$	134.9
Other comprehensive income (loss) before reclassifications and income tax benefit (expense)	Other comprehensive income (loss) before reclassifications and income tax benefit (expense)	0.8		(2.0)		0		39.8		38.6		Other comprehensive income (loss) before reclassifications and income tax benefit (expense)	(1.1)		0		0		(51.2)		(52.3)
Amounts reclassified from accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)	0		3.5		(2.4)		0.6		1.7		Amounts reclassified from accumulated other comprehensive income (loss)	0		1.1		(0.3)		0		0.8
Income tax benefit (expense)	Income tax benefit (expense)	(0.2)		(0.4)		0.6		0		0		Income tax benefit (expense)	0.3		(0.3)		0.1		0		0.1
Net current period other comprehensive income (loss)	Net current period other comprehensive income (loss)	0.6		1.1		(1.8)		40.4		40.3		Net current period other comprehensive income (loss)	(0.8)		0.8		(0.2)		(51.2)		(51.4)
Balance at September 30, 2020		$	1.4	$	(54.0)	$	67.2	$	29.1	$	43.7
Balance at March 31, 2021												Balance at March 31, 2021	$	0.8	$	(56.3)	$	66.8	$	72.2	$	83.5


(in millions)	(in millions)	Investment Securities		Defined Benefit Plans		Derivative Investments		Foreign Currency Translation		Total		(in millions)	Investment Securities		Defined Benefit Plans		Derivative Investments		Foreign Currency Translation		Total
Balance at December 31, 2018		$	0.1	$	(53.8)	$	69.7	$	(10.7)	$	5.3
Balance at December 31, 2019												Balance at December 31, 2019	$	0.8	$	(55.1)	$	69.0	$	(11.3)	$	3.4
Other comprehensive income (loss) before reclassifications and income tax benefit (expense)	Other comprehensive income (loss) before reclassifications and income tax benefit (expense)	1.5		(2.7)		0.3		(38.5)		(39.4)		Other comprehensive income (loss) before reclassifications and income tax benefit (expense)	(0.6)		(2.0)		0		(27.8)		(30.4)
Amounts reclassified from accumulated other comprehensive income (loss)	Amounts reclassified from accumulated other comprehensive income (loss)	(0.2)		3.7		(0.9)		0		2.6		Amounts reclassified from accumulated other comprehensive income (loss)	0		1.2		(1.8)		0.6		0
Income tax benefit (expense)	Income tax benefit (expense)	(0.4)		(0.3)		0		0		(0.7)		Income tax benefit (expense)	0.2		0.2		0.4		0		0.8
Net current period other comprehensive income (loss)	Net current period other comprehensive income (loss)	0.9		0.7		(0.6)		(38.5)		(37.5)		Net current period other comprehensive income (loss)	(0.4)		(0.6)		(1.4)		(27.2)		(29.6)

Balance at September 30, 2019		$	1.0	$	(53.1)	$	69.1	$	(49.2)	$	(32.2)
Balance at March 31, 2020												Balance at March 31, 2020	$	0.4	$	(55.7)	$	67.6	$	(38.5)	$	(26.2)

11. Fair Value Measurements

The company uses a three-level classification hierarchy of fair value measurements for disclosure purposes:

•Level 1 inputs, which are considered the most reliable evidence of fair value, consist of quoted prices (unadjusted) for identical assets or liabilities in active markets.

•Level 2 inputs consist of observable market data, such as quoted prices for similar assets and liabilities in active markets, or inputs other than quoted prices that are directly observable.

•Level 3 inputs consist of unobservable inputs which are derived and cannot be corroborated by market data or other entity-specific inputs.

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The company's level 1 assets generally include investments in publicly traded mutual funds, equity securities and corporate debt ~~securities and U.S. government~~ securities with quoted market prices. In general, the company uses quoted prices in active markets for identical assets to determine the fair value of marketable securities.

The company's level 2 assets and liabilities generally consist of asset-backed securities and long-term debt notes. Asset-backed securities were measured at fair value based on matrix pricing using prices of similar securities with similar inputs such as maturity dates, interest rates and credit ratings. The fair values of the long-term debt notes were based on quoted market prices in an inactive market.

The company's level 3 assets and liabilities include certain fixed ~~assets, intangible~~ assets and investments that were impaired or written up in fair value.

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Recurring Fair Value Measurements. Financial assets and liabilities recorded at fair value on the consolidated balance sheet as of ~~September 30, 2020~~March 31, 2021 were classified in their entirety based on the lowest level of input that was significant to each asset and liability's fair value measurement. The following table presents financial instruments measured at fair value on a recurring basis:

September 30, 2020
(in millions) Level 1 Level 2 Level 3 Total
Assets at Fair Value:
Marketable securities:
Corporate debt securities $ 18.1 $ 0 $ 0 $ 18.1
Mutual funds 73.9 0 0 73.9
Equity securities 0.1 0 0 0.1
Asset-backed securities 0 0.3 0 0.3
Total Marketable Securities 92.1 0.3 0 92.4
Performance bonds and guaranty fund contributions (1):
U.S. Treasury securities 800.0 0 0 800.0
U.S. government agency securities 195.0 0 0 195.0
Total Assets at Fair Value $ 1,087.1 $ 0.3 $ 0 $ 1,087.4

(1) Performance bonds and guaranty fund contributions on the consolidated balance sheet at September 30, 2020 include U.S. Treasury securities and U.S. government agency securities purchased with cash collateral.


	March 31, 2021
(in millions)	Level 1		Level 2		Level 3		Total
Assets at Fair Value:
Marketable securities:
Corporate debt securities	$	17.0	$	0	$	0	$	17.0

Mutual funds	87.7		0		0		87.7
Equity securities	0.2		0		0		0.2
Asset-backed securities	0		0.3		0		0.3
Total Marketable Securities	104.9		0.3		0		105.2





Total Assets at Fair Value	$	104.9	$	0.3	$	0	$	105.2

Non-Recurring Fair Value Measurements. ~~During the first nine months of 2020, the~~The company recognized impairment charges of $~~27.4~~0.5 million related to certain ~~intangible assets and~~ fixed assets. The ~~combined~~ fair values of ~~the~~these fixed assets were estimated to be 0 at ~~September 30, 2020.~~March 31, 2021. The company also recognized a net unrealized ~~gains~~gain on ~~certain investments~~an investment of $~~1.3~~0.8 million. The ~~combined~~ fair value of ~~these investments were~~the investment was estimated to be $~~18.4~~9.4 million at ~~September 30, 2020.~~March 31, 2021. These assessments were based on quantitative and qualitative indicators of fair value. The fair value measurements of the ~~intangible assets,~~ fixed assets and ~~investments~~investment are considered level 3 and non-recurring.

Fair Values of Long-Term Debt Notes. The following presents the estimated fair values of long-term debt notes, which are carried at amortized cost on the consolidated balance sheets. The fair values below are classified as level 2 under the fair value hierarchy and were estimated using quoted market prices in inactive markets.

At ~~September 30, 2020,~~March 31, 2021, the fair values (in U.S. dollar equivalent) were as follows:


(in millions)	Fair Value		Level

$750.0 million fixed rate notes due September 2022	$	~~788.0~~779.4	Level 2
€15.0 million fixed rate notes due May 2023	~~19.3~~19.2		Level 2
$750.0 million fixed rate notes due March 2025	~~821.8~~802.8		Level 2
$500.0 million fixed rate notes due June 2028	~~587.0~~557.4		Level 2
$750.0 million fixed rate notes due September 2043	~~1,113.9~~1,015.3		Level 2
$700.0 million fixed rate notes due June 2048	~~941.0~~845.1		Level 2

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12. Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted average number of shares of all classes of CME Group common stock outstanding for each reporting period. Diluted earnings per share reflects the increase in shares using the treasury stock method to reflect the impact of an equivalent number of shares of common stock if stock options were exercised and restricted stock awards were converted into common stock. Anti-dilutive stock awards were as follows for the periods presented:


		Quarter Ended September 30,		Nine Months Ended September 30,			Quarter Ended March 31,
(in thousands)	(in thousands)	2020	2019	2020	2019	(in thousands)		2021	2020

Stock awards	Stock awards	44	98	44	473	Stock awards		154	68
Total	Total	44	98	44	473	Total		154	68

The following table presents the earnings per share calculation for the periods presented:


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
		2020		2019		2020		2019				2021		2020
Net Income Attributable to CME Group (in millions)	Net Income Attributable to CME Group (in millions)	$	411.7	$	636.3	$	1,681.2	$	1,647.0	Net Income Attributable to CME Group (in millions)		$	574.4	$	766.2
Weighted Average Number of Common Shares (in thousands):	Weighted Average Number of Common Shares (in thousands):									Weighted Average Number of Common Shares (in thousands):
Basic	Basic	357,791		357,211		357,669		357,054		Basic		358,147		357,524
Effect of stock options, restricted stock and performance shares	Effect of stock options, restricted stock and performance shares	799		1,158		823		1,147		Effect of stock options, restricted stock and performance shares		670		931
Diluted	Diluted	358,590		358,369		358,492		358,201		Diluted		358,817		358,455
Earnings per Common Share Attributable to CME Group:	Earnings per Common Share Attributable to CME Group:									Earnings per Common Share Attributable to CME Group:
Basic	Basic	$	1.15	$	1.78	$	4.70	$	4.61	Basic		$	1.60	$	2.14
Diluted	Diluted	1.15		1.78		4.69		4.60		Diluted		1.60��		2.14

13. Subsequent Events

The company has evaluated subsequent events through the date the financial statements were issued. The company has determined that there were no subsequent events.

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ITEM 2.			MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion is provided as a supplement to, and should be read in conjunction with, the accompanying unaudited consolidated financial statements and notes in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, ~~2019.~~2020.

References in this discussion and analysis to “we” and “our” are to CME Group Inc. (CME Group) and its consolidated subsidiaries, collectively. References to “exchange” are to Chicago Mercantile Exchange Inc. (CME), the Board of Trade of the City of Chicago, Inc. (CBOT), New York Mercantile Exchange, Inc. (NYMEX), and Commodity Exchange, Inc. (COMEX), collectively, unless otherwise noted.

RESULTS OF OPERATIONS

Financial Highlights

The following summarizes significant changes in our financial performance for the periods presented.


		Quarter Ended September 30,								Nine Months Ended September 30,									Quarter Ended March 31,
(dollars in millions, except per share data)	(dollars in millions, except per share data)	2020			2019			Change		2020			2019			Change		(dollars in millions, except per share data)		2021			2020			Change
Total revenues	Total revenues	$	1,080.7		$	1,277.3		(15)	%	$	3,785.1		$	3,729.6		1	%	Total revenues		$	1,253.3		$	1,522.1		(18)	%
Total expenses	Total expenses	555.7			592.1			(6)		1,662.7			1,714.8			(3)		Total expenses		528.2			562.2			(6)
Operating margin	Operating margin	48.6		%	53.6		%			56.1		%	54.0		%			Operating margin		57.9		%	63.1		%
Non-operating income (expense)	Non-operating income (expense)	$	11.5		$	38.0		(70)		$	64.7		$	50.7		27		Non-operating income (expense)		$	27.2		$	29.4		(7)
Effective tax rate	Effective tax rate	23.3		%	12.0		%			23.1		%	20.3		%			Effective tax rate		23.6		%	22.5		%
Net income attributable to CME Group	Net income attributable to CME Group	$	411.7		$	636.3		(35)		$	1,681.2		$	1,647.0		2		Net income attributable to CME Group		$	574.4		$	766.2		(25)
Diluted earnings per common share attributable to CME Group	Diluted earnings per common share attributable to CME Group	1.15			1.78			(35)		4.69			4.60			2		Diluted earnings per common share attributable to CME Group		1.60			2.14			(25)
Cash flows from operating activities	Cash flows from operating activities									2,055.3			1,953.1			5		Cash flows from operating activities		602.7			757.1			(20)

Revenues


		Quarter Ended September 30,						Nine Months Ended September 30,							Quarter Ended March 31,
(dollars in millions)	(dollars in millions)	2020		2019		Change		2020		2019		Change		(dollars in millions)		2021		2020		Change
Clearing and transaction fees	Clearing and transaction fees	$	835.4	$	1,040.7	(20)	%	$	3,054.4	$	3,045.1	—	%	Clearing and transaction fees		$	1,007.0	$	1,278.8	(21)	%
Market data and information services	Market data and information services	139.4		129.8		7		405.6		388.2		4		Market data and information services		144.2		131.5		10
Other	Other	105.9		106.8		(1)		325.1		296.3		10		Other		102.1		111.8		(9)
Total Revenues	Total Revenues	$	1,080.7	$	1,277.3	(15)		$	3,785.1	$	3,729.6	1		Total Revenues		$	1,253.3	$	1,522.1	(18)

Clearing and Transaction Fees

Futures and Options Contracts

The following table summarizes our total contract volume, revenue and average rate per contract for futures and options. Total contract volume includes contracts that are traded on our exchange and cleared through our clearing house and certain cleared-only contracts. Volume is measured in round turns, which is considered a completed transaction that involves a purchase and an offsetting sale of a contract. Average rate per contract is determined by dividing total clearing and transaction fees by total contract volume. Contract volume and average rate per contract disclosures exclude trading volume for the cash markets business and interest rate swaps volume.


		Quarter Ended September 30,						Nine Months Ended September 30,							Quarter Ended March 31,
		2020		2019		Change		2020		2019		Change				2021		2020		Change
Total contract volume (in millions)	Total contract volume (in millions)	998.6		1,295.8		(23)	%	3,782.2		3,750.2		1	%	Total contract volume (in millions)		1,331.5		1,674.8		(21)	%
Clearing and transaction fees (in millions)	Clearing and transaction fees (in millions)	$	715.0	$	898.2	(20)		$	2,658.8	$	2,622.8	1		Clearing and transaction fees (in millions)		$	875.6	$	1,133.0	(23)
Average rate per contract	Average rate per contract	$	0.716	$	0.693	3		$	0.703	$	0.699	1		Average rate per contract		$	0.658	$	0.676	(3)

We estimate the following net changes in clearing and transaction fees based on ~~changes~~a change in total contract volume and ~~changes~~a change in average rate per contract for futures and options during the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019.~~2020.

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(in millions) Quarter Ended Nine Months Ended
Increase (decrease) due to changes in total contract volume $ (212.8) $ 22.5
Increases due to changes in average rate per contract 29.6 13.5
Net increase (decrease) in clearing and transaction fees $ (183.2) $ 36.0


(in millions)	Quarter Ended
Decrease due to change in total contract volume	$	(225.9)
Decrease due to change in average rate per contract	(31.5)
Net decrease in clearing and transaction fees	$	(257.4)

Average rate per contract is impacted by our rate structure, including volume-based incentives; product mix; trading venue, and the percentage of volume executed by customers who are members compared with non-member customers. Due to the relationship between average rate per contract and contract volume, the change in clearing and transaction fees attributable to changes in each is only an approximation.

Contract Volume

The following table summarizes average daily contract volume. Contract volume can be influenced by many factors, including political and economic conditions, the regulatory environment and market competition.


		Quarter Ended September 30,						Nine Months Ended September 30,							Quarter Ended March 31,
(amounts in thousands)	(amounts in thousands)	2020		2019		Change		2020		2019		Change		(amounts in thousands)		2021		2020		Change
Average Daily Volume by Product Line:	Average Daily Volume by Product Line:													Average Daily Volume by Product Line:
Interest rates	Interest rates	5,315		10,868		(51)	%	8,628		10,931		(21)	%	Interest rates		10,349		13,813		(25)	%
Equity indexes	Equity indexes	5,410		3,931		38		5,820		3,530		65		Equity indexes		6,117		6,498		(6)
Foreign exchange	Foreign exchange	829		851		(3)		876		869		1		Foreign exchange		852		1,079		(21)
Agricultural commodities	Agricultural commodities	1,372		1,320		4		1,396		1,514		(8)		Agricultural commodities		1,471		1,506		(2)
Energy	Energy	1,852		2,456		(25)		2,548		2,430		5		Energy		2,363		3,228		(27)
Metals	Metals	825		821		1		744		674		10		Metals		675		889		(24)
Aggregate average daily volume	Aggregate average daily volume	15,603		20,247		(23)		20,012		19,948		—		Aggregate average daily volume		21,827		27,013		(19)
Average Daily Volume by Venue:	Average Daily Volume by Venue:													Average Daily Volume by Venue:
CME Globex	CME Globex	15,054		18,282		(18)		18,826		17,803		6		CME Globex		20,436		24,582		(17)
Open outcry	Open outcry	108		1,177		(91)		457		1,320		(65)		Open outcry		678		1,281		(47)
Privately negotiated	Privately negotiated	441		788		(44)		729		825		(12)		Privately negotiated		713		1,150		(38)
Aggregate average daily volume	Aggregate average daily volume	15,603		20,247		(23)		20,012		19,948		—		Aggregate average daily volume		21,827		27,013		(19)
Electronic Volume as a Percentage of Total Volume	Electronic Volume as a Percentage of Total Volume	96	%	90	%			94	%	89	%			Electronic Volume as a Percentage of Total Volume		94	%	91	%

Overall market volatility declined ~~throughout~~throughout the ~~third~~first quarter of ~~2020~~2021 following ~~periods of~~ very high volatility in the first quarter of 2020. During the first quarter of 2020, the Federal Reserve made the unexpected decision to lower the federal funds rate due to the economic concerns from the COVID-19 pandemic ~~which~~and announced their intent not to raise them for the foreseeable future. This resulted in significant volatility within the financial and equity ~~markets. During~~markets in the ~~third~~first quarter of 2020 ~~interest rate volatility~~which subsided ~~following indication~~ by the ~~Federal Reserve that it does not intend to raise interest rates in the foreseeable future.~~end of 2020. In addition, ~~heightened~~lower producer price competition within the oil markets combined with lower energy demands during the COVID-19 pandemic resulted in ~~significant~~lower market volatility within the energy market during the first quarter of 2020. However, volatility subsided in the third quarter as oil prices stabilized and demand for crude oil remained low. We believe these factors led to the changes in volume during the third quarter and first nine months of 2020, when compared with the same periods in 2019.2021.

Following the Illinois stay at home orders in March 2020, we closed the trading floor in Chicago. We began a limited re-opening of the trading floor in the third quarter of 2020.

In May 2021, we announced that only the Eurodollar options pit will remain open. We will not reopen the remaining trading floor pits.

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Interest Rate Products

The following table summarizes average daily contract volume for our key interest rate products. Eurodollar Front 8 futures include contracts expiring in two years or less. Eurodollar Back 32 futures include contracts with expirations after two years through ten years.


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(amounts in thousands)	(amounts in thousands)	2020	2019	Change		2020	2019	Change		(amounts in thousands)		2021	2020	Change
Eurodollar futures and options:	Eurodollar futures and options:									Eurodollar futures and options:
Front 8 futures	Front 8 futures	741	2,077	(64)	%	1,479	2,193	(33)	%	Front 8 futures		1,262	2,596	(51)	%
Back 32 futures	Back 32 futures	457	687	(34)		623	719	(13)		Back 32 futures		1,414	892	58
Options	Options	422	1,633	(74)		1,254	1,861	(33)		Options		1,106	2,384	(54)
U.S. Treasury futures and options:	U.S. Treasury futures and options:									U.S. Treasury futures and options:
10-Year	10-Year	1,462	2,462	(41)		2,093	2,368	(12)		10-Year		2,820	3,191	(12)
5-Year	5-Year	777	1,420	(45)		1,146	1,408	(19)		5-Year		1,463	1,699	(14)
Treasury Bond										Treasury Bond		658	638	3
2-Year	2-Year	347	785	(56)		583	754	(23)		2-Year		502	945	(47)
Treasury bond		422	524	(20)		471	473	—
Federal Funds futures and options	Federal Funds futures and options	87	450	(81)		256	387	(34)		Federal Funds futures and options		100	501	(80)

In the ~~third~~first quarter ~~and the first nine months of 2020,~~2021, overall interest rate contract ~~volumes~~volume decreased when compared with the same ~~periods~~period in ~~2019,~~2020, which we believe resulted from low interest rate volatility. Interest rate volatility decreased following the Federal Reserve's decision to cut interest rates to near zero in early 2020 and its indication that it would not raise interest rates in the foreseeable future in response to the economic impact of the COVID-19 pandemic. The decrease in volume was partially offset by an increase in Back 32 futures volume, which we believe resulted from market participants' expectations for future increases in interest rates within the next few years.

Equity Index Products

The following table summarizes average daily contract volume for our key equity index products. ~~Volumes below include Micro E-mini~~


	Quarter Ended March 31,
(amounts in thousands)		2021	2020	Change
E-mini S&P 500 futures and options		3,485	4,251	(18)	%
E-mini NASDAQ 100 futures and options		1,724	1,293	33
E-mini Russell 2000 futures and options		416	310	34

Equity index contract ~~volumes for each index beginning on May 6, 2019.~~

Quarter Ended
September 30, Nine Months Ended
September 30,
(amounts in thousands) 2020 2019 Change 2020 2019 Change
E-mini S&P 500 futures and options 3,311 2,617 27 % 3,728 2,384 56 %
E-mini NASDAQ 100 futures and options 1,397 722 94 1,265 602 110
E-mini Russell 2000 futures and options 285 198 44 311 170 83

~~In the third quarter and~~volume decreased in the first ~~nine months~~quarter of ~~2020, equity index contract volumes increased~~2021 when compared with the same ~~periods~~period in ~~2019. We believe these increases were attributable to~~2020. Volatility within the broad-based indexes, including the S&P 500, subsided in the first quarter of 2021 following significant equity market volatility in early 2020 resulting from uncertainty surrounding the economic impact of governmental and business actions to combat the COVID-19 pandemic. However, there was an increase in volatility within the narrow-based indexes, which experienced a market repricing in the first quarter of 2021. We believe this increase in volatility contributed to an increase in E-mini NASDAQ 100 and E-mini Russell 2000 contracts. Average daily contract volume in the ~~third~~first quarter ~~and first nine months of 2020~~2021 also included Micro-E-mini equity index contract volume of approximately ~~2.0~~ 2.5 million ~~and 1.8 million per day, respectively,~~ compared to approximately ~~0.6~~1.4 million ~~and 0.3 million per day,~~ in ~~the third quarter and first nine months of 2019, respectively.~~2020. Micro-E-mini equity index contracts have a notional size of one-tenth of the traditional E-mini contracts.

Foreign Exchange Products

The following table summarizes average daily contract volume for our key foreign exchange products.


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(amounts in thousands)	(amounts in thousands)	2020	2019	Change		2020	2019	Change		(amounts in thousands)		2021	2020	Change
Euro	Euro	249	237	5	%	244	238	2	%	Euro		229	285	(20)	%
Australian dollar										Australian dollar		120	131	(9)
Japanese yen	Japanese yen	97	143	(32)		128	141	(9)		Japanese yen		112	198	(44)
British Pound	British Pound	114	125	(9)		113	126	(10)		British Pound		100	133	(25)
Australian dollar		99	96	4		109	106	3

In the ~~third~~first quarter ~~and the first nine months~~ of ~~2020,~~2021, foreign exchange contract volume ~~remained relatively flat~~decreased when compared with the same ~~periods~~period in ~~2019. In the third quarter of 2020, market~~2020. Market volatility subsided following very high foreign exchange volatility in the first quarter of 2020 caused by significant uncertainty

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surrounding the economic impacts of the governmental and business actions to combat the COVID-19 ~~pandemic. In the third quarter of 2020, foreign exchange trading also declined~~

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~~slightly due to operational strains from stay at home orders and risk aversion by market participants during the COVID-19~~ pandemic. WeWe believe these factors led to the ~~changes~~decrease in foreign exchange contract ~~volumes.~~volume.

Agricultural Commodity Products

The following table summarizes average daily contract volume for our key agricultural commodity products.


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(amounts in thousands)	(amounts in thousands)	2020	2019	Change		2020	2019	Change		(amounts in thousands)		2021	2020	Change
Corn	Corn	440	490	(10)	%	438	583	(25)	%	Corn		511	436	17	%
Soybean	Soybean	292	216	35		280	255	10		Soybean		328	289	14
Wheat	Wheat	219	189	16		227	227	—		Wheat		197	251	(22)

Overall commodity contract volume ~~increased~~remained relatively flat in the ~~third~~first quarter of ~~2020~~2021 compared with the same period in ~~2019, but decreased in~~2020. We believe the ~~first nine months of 2020 when compared with the same period in 2019. The~~ increase in ~~the third quarter was mainly attributable to an increase in~~corn and soybean ~~and wheat~~ volume ~~which we believe~~ was the result of an increase in demand in commodities from China. ~~In the third quarter and first nine months of 2020 when compared with 2019, corn contract~~The decrease in wheat volume ~~decreased~~was largely due to ~~continued lower~~low price ~~volatility, which we believe was caused by the existence of large stock piles and lower demand.~~volatility.

Energy Products

The following table summarizes average daily contract volume for our key energy products.


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(amounts in thousands)	(amounts in thousands)	2020	2019	Change		2020	2019	Change		(amounts in thousands)		2021	2020	Change
WTI crude oil	WTI crude oil	873	1,398	(38)	%	1,369	1,405	(3)	%	WTI crude oil		1,265	1,792	(29)	%
Natural gas	Natural gas	582	560	4		657	500	31		Natural gas		569	742	(23)
Refined products	Refined products	307	360	(15)		379	382	(1)		Refined products		382	497	(23)

Overall energy contract ~~volumes~~volume decreased in the ~~third~~first quarter when compared with the same period in ~~2019,~~2020, which we believe was largely due to ~~decreases~~a decrease in price volatility. The crude oil market remains less volatile as the market continues to rebalance from a reduction in demand caused by the COVID-19 pandemic. The increase in volume in the first nine months of 2020 when compared with the same period in 2019 was largely attributable to an increase in natural gas contract volume due to volatility caused by significant price declines in early 2020, which resulted from a reduction of global demand.

Metal Products

The following table summarizes average daily volume for our key metal products.


		Quarter Ended September 30,				Nine Months Ended September 30,					Quarter Ended March 31,
(amounts in thousands)	(amounts in thousands)	2020	2019	Change		2020	2019	Change		(amounts in thousands)		2021	2020	Change
Gold	Gold	526	559	(6)	%	490	432	13	%	Gold		404	608	(34)	%
Silver	Silver	180	137	31		129	109	18		Silver		128	125	2
Copper	Copper	99	93	7		101	102	—		Copper		120	121	(1)

In the ~~third~~first quarter ~~and the first nine months of 2020, metals volumes increased~~2021, metal contract volume decreased when compared with the same ~~periods~~period in ~~2019. We believe these increases are largely due~~2020. The decrease in gold volume can be attributed to lower overall market volatility. In early 2020, investors were using gold and other precious metals as safe-haven ~~alternative~~ investments ~~due to significant~~in the first quarter of 2020 as a result of uncertainty within other markets caused by the COVID-19 pandemic.

Average Rate per Contract

The average rate per contract ~~increased~~decreased in the ~~third~~first quarter ~~and first nine months of 2020~~2021 when compared with the same period in ~~2019.~~2020. The ~~increases were~~decrease was largely due to ~~a shift~~the increase in product mix. Interest rate contract volume, as a percentage of total volume, decreased by 20% in the third quarter when compared with the same period in 2019, respectively, while all other products collectively increased by 20%. Interest rate contract volume, as a percentage of total volume, decreased by 12% in the first nine months when compared with the same period in 2019, respectively, while all other products collectively increased by 12%. In general, interest rate products have a lower rate per contract compared with the remaining contracts. The increases in average rate per contract were partially offset by the introduction of the micro-E-mini equity index ~~contracts,~~contract volume, which have a lower average rate per contract compared with a standard E-mini contract. Micro-E-mini equity index contracts have a notional size of one-tenth of the traditional E-mini contracts. This decrease was partially offset by the rate impact of higher non-member volume as a percentage of total volume.

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Cash Markets Business

Total clearing and transaction fees revenues in the ~~third~~first quarter ~~and the first nine months of 2020~~2021 include ~~$105.6 million and $342.4~~$115.1 million of transaction fees attributable to the cash markets business ~~acquired from NEX~~ compared with $1~~24.9 million and $368.5~~24.4 million in the ~~third~~first quarter ~~and first nine months~~ of ~~2019, respectively.~~2020. This revenue primarily includes BrokerTec Americas LLC's fixed income volume and EBS's foreign exchange volume.


		Quarter Ended September 30,						Nine Months Ended September 30,							Quarter Ended March 31,
(amounts in millions)	(amounts in millions)	2020		2019		Change		2020		2019		Change		(amounts in millions)		2021		2020		Change
BrokerTec U.S.'s fixed income transaction fees	BrokerTec U.S.'s fixed income transaction fees	$	39.8	$	51.1	(22)	%	$	133.3	$	147.2	(9)	%	BrokerTec U.S.'s fixed income transaction fees		$	45.5	$	50.3	(10)	%
EBS's foreign exchange transaction fees	EBS's foreign exchange transaction fees	42.3		49.6		(15)		136.9		148.4		(8)		EBS's foreign exchange transaction fees		45.3		52.5		(14)

The related average daily notional value for the ~~third~~first quarter of ~~2020~~2021 were as follows:


		Quarter Ended September 30,						Nine Months Ended September 30,							Quarter Ended March 31,
(amounts in billions)	(amounts in billions)	2020		2019		Change		2020		2019		Change		(amounts in billions)		2021		2020		Change
U.S. Treasury	U.S. Treasury	$	93.2	$	178.5	(48)	%	$	135.3	$	174.7	(23)	%	U.S. Treasury		$	136.0	$	192.8	(29)	%
European Repo (in euros)	European Repo (in euros)	261.6		271.9		(4)		265.9		275.1		(3)		European Repo (in euros)		287.3		262.6		9
Spot FX	Spot FX	63.3		78.5		(19)		74.3		79.3		(6)		Spot FX		72.7		97.9		(26)

Overall average daily notional value for the cash markets business decreased in the ~~third~~first quarter ~~and first nine months of 2020~~2021 when compared with the same ~~periods~~period in ~~2019.~~2020. The ~~decreases~~decrease in trading ~~are~~is largely due to lower volatility as the first quarter of 2020 saw high volatility as a result of the uncertainty surrounding the COVID-19 pandemic. In addition, market participants' expectation of potentially low interest rates for an extended period of time ~~and~~contributed to lower volumes in the ~~economic uncertainty surrounding the COVID-19 pandemic.~~first quarter of 2021.

Concentration of Revenue

We bill a substantial portion of our clearing and transaction fees directly to our clearing firms. The majority of clearing and transaction fees received from clearing firms represent charges for trades executed and cleared on behalf of their customers. One individual firm represented ~~approximately~~approximately 11% of ~~our~~our clearing and transaction fees in the first ~~nine months~~quarter of ~~2020.~~2021. Should a clearing firm withdraw, we believe that the customer portion of the firm’s trading activity would likely transfer to another clearing firm of the exchange. Therefore, we do not believe we are exposed to significant risk from the ongoing loss of revenue received from or through a particular clearing firm.

Other Sources of Revenue

During the ~~third~~first quarter ~~and first nine months~~ of ~~2020,~~2021, overall market data and information services ~~revenues~~revenue increased when compared with the same ~~periods~~period in ~~2019~~2020 largely due to price increases ~~in subscriber device counts and higher demand~~ for ~~CME data.~~certain products.

The two largest resellers of our market data represented approximately ~~35%~~33% of our market data and information services revenue in the first ~~nine months~~quarter of ~~2020.~~2021. Despite this concentration, we consider exposure to significant risk of revenue loss to be minimal. In the event that one of these vendors no longer subscribes to our market data, we believe the majority of that vendor’s customers would likely subscribe to our market data through another reseller. Additionally, several of our largest institutional customers that utilize services from our two largest resellers report usage and remit payment of their fees directly to us.

In the ~~third~~first quarter of ~~2020~~2021, the decrease in other revenue ~~was relatively flat as compared with the same period in 2019. In the first nine months of 2020~~ when compared with the same period in ~~2019, the increase in other revenues~~2020 was largely due to ~~increases~~a decrease in processing services revenue and custody fees.

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Expenses

Quarter Ended
September 30, Nine Months Ended
September 30,
(dollars in millions) 2020 2019 Change 2020 2019 Change
Compensation and benefits $ 216.4 $ 223.5 (3) % $ 640.9 $ 681.1 (6) %
Technology 48.1 52.7 (9) 144.9 148.4 (2)
Professional fees and outside services 48.4 43.2 12 141.3 124.3 14
Amortization of purchased intangibles 78.3 79.8 (2) 232.2 236.6 (2)
Depreciation and amortization 39.7 41.4 (4) 111.7 120.6 (7)
Licensing and other fee agreements 57.7 45.6 27 187.0 130.9 43
Other 67.1 105.9 (37) 204.7 272.9 (25)
Total Expenses $ 555.7 $ 592.1 (6) $ 1,662.7 $ 1,714.8 (3)


	Quarter Ended March 31,
(dollars in millions)		2021		2020		Change
Compensation and benefits		$	225.0	$	207.5	8	%
Technology		48.2		47.7		1
Professional fees and outside services		37.4		41.7		(10)
Amortization of purchased intangibles		60.6		77.3		(22)
Depreciation and amortization		37.6		35.3		6
Licensing and other fee agreements		64.7		73.9		(12)
Other		54.7		78.8		(31)
Total Expenses		$	528.2	$	562.2	(6)

Operating expenses decreased by ~~$36.4 million and $52.1~~$34.0 million in the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019.~~2020. The following table shows the estimated impacts of key factors resulting in the change in operating expenses:


		Quarter Ended, September 30, 2020				Nine Months Ended, September 30, 2020						Quarter Ended, March 31, 2021
		Amount of Change		Change as a Percentage of Total Expenses		Amount of Change		Change as a Percentage of Total Expenses					Amount of Change		Change as a Percentage of Total Expenses
(dollars in millions)	(dollars in millions)									(dollars in millions)	Amount of Change	Change as a Percentage of Total Expenses
Intangible and fixed asset impairments	Intangible and fixed asset impairments	$	(45.0)	(8)	%	$	(52.6)	(3)	%	Intangible and fixed asset impairments			$	(22.8)	(4)	%
Amortization of purchased intangibles										Amortization of purchased intangibles			(16.7)		(3)
Licensing and other fee agreements										Licensing and other fee agreements			(9.2)		(2)
Bonus expense	Bonus expense	(21.5)		(4)		(36.1)		(2)		Bonus expense			(8.7)		(1)
Travel and entertainment		(6.5)		(1)		(17.5)		(1)
Marketing		(2.7)		—		(15.7)		(1)
Employee severance and restructuring										Employee severance and restructuring			10.8		2
Non-qualified deferred compensation plans	Non-qualified deferred compensation plans	4.6		1		(2.1)		—		Non-qualified deferred compensation plans			12.0		2
Professional fees and outside services		5.2		1		17.0		1
Licensing and other fee agreements		12.1		2		56.1		3
Other expenses, net	Other expenses, net	17.4		3		(1.2)		—		Other expenses, net			0.6		—
Total decrease	Total decrease	$	(36.4)	(6)	%	$	(52.1)	(3)	%	Total decrease			$	(34.0)	(6)	%

Decreases in operating expenses in the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019~~2020 were as follows:

•In the ~~third~~first quarter ~~and first nine months~~ of ~~2019,~~2020, we recognized higher impairment charges on certain intangibles and fixed assets due to the disposal of various businesses.

•~~Bonus expense decreased compared with~~Amortization of purchased intangibles was lower during the ~~same periods in 2019 largely due~~first quarter of 2021, as intangible assets related to ~~a reduction in headcount in conjunction with our planned integration of legacy NEX businesses.~~

•~~Travel and entertainment expenses decreased~~CME Group's optimization business were classified as ~~a result~~held for sale following approval of the IHS Markit joint venture by the company's ~~response to the COVID-19 pandemic, with the vast majority~~Board of ~~staff working remotely in 2020.~~

•~~Marketing expenses decreased compared with the same periods in 2019 due to the timing of planned advertising and media campaigns,~~Directors. Amortization is no longer taken on intangible assets once they are classified as ~~well as a reduction in special promotional events held.~~held for sale.

•A decrease in ~~our non-qualified deferred compensation liability during~~licensing and other fee agreements expense was due to lower volumes for certain equity products in the first ~~nine months~~quarter of 2021 compared to the same period in 2020.

•Bonus expense decreased due to performance relative to our 2021 cash earnings target when compared with 2020 ~~the impact of which does not affect net income because of an equal and offsetting change in investment income, contributed~~performance relative to ~~a decrease in compensation and benefits expense.~~our 2020 cash earnings target.

Increases in operating expenses in ~~the third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019~~2020 were as follows:

•Licensing and other fee agreements expenses increased in the third quarter and first nine months of 2020 due to higher fees related to revenue sharing agreements for certain equity contracts, which resulted from increases in volume and increases in license rates for certain products.

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•~~Professional fees and outside services expenses increased due to higher costs in the third quarter and first nine months of 2020 for legal fees and technology and platform integration initiatives.~~

•An increase in our non-qualified deferred compensation liability during the ~~third~~first quarter of ~~2020,~~2021, the impact of which does not affect net income because of an equal and offsetting change in investment income, contributed to an increase in compensation and benefits expense.

•Employee severance cost was higher during the first quarter of 2021 due to a higher reduction in workforce compared to the same period in 2020.

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Non-Operating Income (Expense)


		Quarter Ended September 30,						Nine Months Ended September 30,							Quarter Ended March 31,
(dollars in millions)	(dollars in millions)	2020		2019		Change		2020		2019		Change		(dollars in millions)		2021		2020		Change
Investment income	Investment income	$	23.6	$	172.3	(86)	%	$	151.6	$	490.3	(69)	%	Investment income		$	30.9	$	95.9	(68)	%
Interest and other borrowing costs	Interest and other borrowing costs	(41.7)		(42.8)		(3)		(124.5)		(136.0)		(8)		Interest and other borrowing costs		(41.5)		(40.9)		1
Equity in net earnings (losses) of unconsolidated subsidiaries	Equity in net earnings (losses) of unconsolidated subsidiaries	44.0		48.0		(9)		144.0		132.3		9		Equity in net earnings (losses) of unconsolidated subsidiaries		56.2		51.2		10
Other non-operating income (expense)	Other non-operating income (expense)	(14.4)		(139.5)		(90)		(106.4)		(435.9)		(76)		Other non-operating income (expense)		(18.4)		(76.8)		(76)
Total Non-Operating	Total Non-Operating	$	11.5	$	38.0	(70)		$	64.7	$	50.7	27		Total Non-Operating		$	27.2	$	29.4	(7)

Investment income. Investment income decreased in the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019,~~2020, largely due to ~~decreases~~a decrease in earnings from cash performance bond and guaranty fund contributions that are reinvested. ~~These decreases~~The decrease in earnings resulted ~~primarily~~ from lower rates of interest earned in the cash account at the Federal Reserve Bank of Chicago following significant interest rate cuts in early 2020 by the Federal Reserve despite ~~increases~~an increase in ~~our~~ average reinvestment ~~amount.~~

~~Interest and other borrowing costs.~~ Interest and other borrowing costs were lower in the third quarter and first nine months of 2020, primarily due to lower borrowing costs on commercial paper issuances, as there were higher average balances of commercial paper outstanding during the first nine months of 2019 when compared with the same period in 2020. ~~Interest and other borrowing costs were also lower during the first nine months of 2020,~~ primarily due to interest expense recognized on the €350.0 million fixed rate notes and the ¥19.1 billion term loan assumed as part of the NEX acquisition in 2018 and subsequently paid down during the first quarter of 2019.balance.

Equity in net earnings (losses) of unconsolidated subsidiaries. In the ~~third~~first quarter of ~~2020~~2021 when compared with the same period of ~~2019, lower~~2020, higher income generated from our S&P/Dow Jones Indices LLC (S&P/DJI) business venture contributed to ~~a decrease~~an increase in equity in net earnings (losses) of unconsolidated subsidiaries. ~~In the first nine months of 2020 when compared to the same period in 2019, our investment in S&P/DJI generated higher equity in net earnings (losses) due to higher profits in early 2020.~~

Other income ~~(expense)~~(expense). Other expenses decreased in the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019.~~2020. We recognized lower expenses during the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 related to a reduction in the distribution of interest earned on performance bond collateral reinvestments to the clearing firms due to lower interest income earned on our reinvestment. ~~In addition, a gain of $1.5 million was recognized on derivative contracts in the first nine months of 2020 compared with a net loss of $17.9 million for the same period in 2019.~~

Income Tax Provision

The following table summarizes the effective tax rates for the periods presented:

2020 2019
Quarter ended September 30 23.3 % 12.0 %
Nine months ended September 30 23.1 % 20.3 %


	2021		2020


Quarter ended March 31	23.6	%	22.5	%

The overall effective tax ~~rates~~rate increased in the ~~third~~first quarter ~~and first nine months~~ of ~~2020~~2021 when compared with the same ~~periods~~period in ~~2019. In~~2020. The effective tax rate was higher in the ~~third~~first quarter of ~~2019, we~~2021 due to a benefit recognized ~~benefits for both 2018 and 2019 for the Foreign Derived Intangible Income Deduction (FDII Deduction) from servicing foreign customers. We have also recognized benefits for the FDII Deduction through~~in the first ~~three quarters~~quarter of ~~2020.~~2020 resulting from the settlement of various tax audits.

Liquidity and Capital Resources

Sources and Uses of Cash. Net cash provided by operating activities ~~increased slightly~~decreased in the first ~~nine months~~quarter of ~~2020~~2021 when compared with the same period in ~~2019~~2020 largely due to ~~an increase in revenues and~~ a decrease in ~~cash-based expenses.~~trading volume. Net cash used in investing activities ~~decreased~~was lower in the first ~~nine months~~quarter of ~~2020 when~~2021 compared with the same period ~~of 2019~~in 2020 largely due to a decrease in purchases of property. Cash used in financing activities was ~~higher~~lower in the first ~~nine months~~quarter of ~~2020~~2021 when compared with the same period in ~~2019~~2020 due to ~~an increase~~net repayments of commercial paper made in ~~cash dividends.~~

~~Table~~the first quarter of ~~Contents~~2020.

Debt Instruments. The following table summarizes our debt outstanding at ~~September 30, 2020:~~March 31, 2021:


(in millions)	Par Value
Fixed rate notes due September 2022, stated rate of 3.00% (1)	$	750.0
Fixed rate notes due May 2023, stated rate of 4.30%	€	15.0
Fixed rate notes due March 2025, stated rate of 3.00% (2)	$	750.0
Fixed rate notes due June 2028, stated rate of 3.75%	$	500.0
Fixed rate notes due September 2043, stated rate of 5.30% (3)	$	750.0
Fixed rate notes due June 2048, stated rate of 4.15%	$	700.0

_______________

(1)We maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 3.32%.

(2)We maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 3.11%.

(3)We maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable effectively became fixed at a rate of 4.73%.

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We maintain a $2.4 billion multi-currency revolving senior credit facility with various financial institutions, which matures in November 2022. The proceeds from this facility can be used for general corporate purposes, which includes providing liquidity for our clearing house in certain circumstances at CME Group's discretion and, if necessary, for maturities of commercial paper. As long as we are not in default under this facility, we have the option to increase it up to $3.0 billion with the consent of the agent and lenders providing the additional funds. This facility is voluntarily pre-payable from time to time without premium or penalty. Under this facility, we are required to remain in compliance with a consolidated net worth test, which is defined as our consolidated shareholders' equity at September 30, 2017, giving effect to share repurchases made and special dividends paid during the term of the agreements (and in no event greater than $2.0 billion in aggregate), multiplied by 0.65. We currently do not have any borrowings outstanding under this facility, but any commercial paper balance if or when outstanding can be backstopped against this facility.

We maintain a 364-day multi-currency revolving secured credit facility with a consortium of domestic and international banks to be used in certain situations by the clearing house. The facility provides for borrowings of up to $7.0 billion. We may use the proceeds to provide temporary liquidity in the unlikely event of a clearing firm ~~default,~~fails to promptly discharge an obligation to CME Clearing, in the event of a liquidity constraint or default by a depositary (custodian for our collateral), or in the event of a temporary disruption with the domestic payments system that would delay payment of settlement variation between us and our clearing ~~firms.~~firms, or in other cases as provided by the CME rulebook. Clearing firm guaranty fund contributions received in the form of cash or U.S. Treasury securities as well as the performance bond assets ~~deposited by defaulting clearing members~~(pursuant to the CME rulebook) can be used to collateralize the facility. At ~~September 30, 2020,~~March 31, 2021, guaranty ~~funds~~fund contributions available to collateralize the facility totaled ~~$7.9~~$8.5 billion. We have the option to request an increase in the line from $7.0 billion to $10.0 billion. Our 364-day facility contains a requirement that CME remain in compliance with a consolidated tangible net worth test, defined as CME consolidated shareholder's equity less intangible assets (as defined in the agreement), of not less than $800.0 million. We currently do not have any borrowings outstanding under this facility.

The indentures governing our fixed rate notes, our $2.4 billion multi-currency revolving senior credit facility and our 364-day multi-currency revolving secured credit facility for $7.0 billion do not contain specific covenants that restrict the ability to pay dividends. These documents, however, do contain other customary financial and operating covenants that place restrictions on the operations of the company that could indirectly affect the ability to pay dividends.

At ~~September 30, 2020,~~March 31, 2021, we have excess borrowing capacity for general corporate purposes of approximately $2.4 billion under our multi-currency revolving senior credit facility.

At ~~September 30, 2020,~~March 31, 2021, we were in compliance with the various financial covenant requirements of all our debt facilities.

CME Group, as a holding company, has no operations of its own. Instead, it relies on dividends declared and paid to it by its subsidiaries in order to provide the funds which it uses to pay dividends to its shareholders.

To satisfy our performance bond obligation with Singapore Exchange Limited, we may pledge irrevocable standby letters of credit. At ~~September 30, 2020,~~March 31, 2021, the letters of credit totaled $310.0 million. We also maintain a $350.0 million line of credit to meet our obligations under this agreement.

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The following table summarizes our credit ratings at ~~September 30, 2020:~~March 31, 2021:

Short-Term

Long-Term

Rating Agency

Debt Rating

Outlook

Standard & Poor’s

A1+

AA-

Stable

Moody’s Investors Service

Aa3

Stable

Given our cash flow generation, our ability to pay down debt levels and our ability to refinance existing debt facilities if necessary, we expect to maintain an investment grade rating. If our ratings are downgraded below investment grade due to a change of control, we are required to make an offer to repurchase our fixed rate notes at a price equal to 101% of the principal amount, plus accrued and unpaid interest.

Liquidity and Cash Management. Cash and cash equivalents totaled ~~$1.3~~$0.9 billion and $1.6 billion at ~~September 30, 2020~~March 31, 2021 and December 31, ~~2019,~~2020, respectively. The balance retained in cash and cash equivalents is a function of anticipated or possible short-term cash needs, prevailing interest rates, our corporate investment policy and alternative investment choices. A majority of our cash and cash equivalents balance is invested in money market mutual funds that invest only in U.S. Treasury securities, U.S. government agency securities and U.S. Treasury security reverse repurchase ~~agreements.~~agreements and short-term bank deposits. Our exposure to credit and liquidity risk is minimal given the nature of the investments. Cash that is not available for general corporate purposes because of regulatory requirements or other restrictions is classified as restricted cash and is included in other current assets or other assets in the consolidated balance sheets.

~~At September 30, 2020,~~

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On May 4, 2021, CME Group's board of directors declared a regular quarterly dividend of $0.90 per share payable on June 25, 2021 to the cash performance bonds and guaranty fund contributions on the consolidated balance sheet was $88.1 billion compared with $37.1 billion at December 31, 2019. The increase in the balance was due to an increase in margin requirements.shareholders of record as of June 10, 2021.

Regulatory Requirements. CME is regulated by the CFTC as a U.S. Derivatives Clearing Organization (DCO). DCOs are required to maintain capital, as defined by the CFTC, in an amount at least equal to one year of projected operating expenses as well as cash, liquid securities, or a line of credit at least equal to six months of projected operating expenses. CME was designated by the Financial Stability Oversight Council as a systemically important financial market utility under Title VIII of Dodd-Frank. As a result, CME must comply with CFTC regulations applicable to a systemically important DCO for financial resources and liquidity resources. CME is in compliance with all DCO financial requirements.

CME, CBOT, NYMEX and COMEX are regulated by the CFTC as Designated Contract Markets (DCM). DCMs are required to maintain capital, as defined by the CFTC, in an amount at least equal to one year of projected operating expenses as well as cash, liquid securities or a line of credit at least equal to six months of projected operating expenses. Our DCMs are in compliance with all DCM financial requirements.

BrokerTec Americas LLC is required to maintain sufficient net capital under Securities Exchange Act Rule 15c3-1 (the Net Capital Rule). The Net Capital Rule focuses on liquidity and is designed to protect securities customers, counterparties, and creditors by requiring that broker-dealers have sufficient liquid resources on hand at all times to satisfy claims promptly. Rule 15c3-3, or the customer protection rule, which complements rule 15c3-1, is designed to ensure that customer property (securities and funds) in the custody of broker-dealers is adequately safeguarded. By law, both of these rules apply to the activities of registered broker-dealers, but not to unregistered affiliates. The firm began operating as a (k)(2)(i) broker dealer in November 2017 following notification to the Financial Industry Regulatory Authority and the SEC. A company operating under the (k)(2)(i) exemption is not required to lock up customer funds as would otherwise be required under Rule 15c3-3 of the Securities Exchange Act.

~~Recent Accounting Pronouncements~~

~~Refer to Note 2. Accounting Policies in our notes to the consolidated financial statements for information on newly issued and recently adopted accounting pronouncements that are applicable to us.~~


ITEM 3.			QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are subject to various market risks, including those caused by changes in interest rates, credit, foreign currency exchange rates and equity prices. There have not been material changes in our exposure to market risk since December 31, ~~2019.~~2020. Refer to Item 7A. of CME Group’s Annual Report on Form 10-K for the year ended December 31, ~~2019~~2020 for additional information.

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ITEM 4.			CONTROLS AND PROCEDURES

(a) Disclosure Controls and Procedures. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of the end of the period covered by this report. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, our disclosure controls and procedures are effective.

(b) Changes in Internal Control Over Financial Reporting. As required by Rule 13a-15(d) under the Exchange Act, the company’s management, including the company’s Chief Executive Officer and Chief Financial Officer, have evaluated the company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) to determine whether any changes occurred during the quarter covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting. There were no changes in the company’s internal control over financial reporting which occurred during the fiscal quarter ended ~~September 30, 2020,~~March 31, 2021, that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.

PART II. OTHER INFORMATION


ITEM 1.			LEGAL PROCEEDINGS

See “Legal and Regulatory Matters” in Note 7. Contingencies to the Consolidated Financial Statements for updates to CME Group’s existing legal proceedings disclosure which is incorporated herein by reference. Note 7. Contingencies includes updates to the legal proceedings disclosed in the company’s Annual Report on Form 10-K, filed with the SEC on February ~~28, 2020.~~26, 2021.


ITEM 1A.			RISK FACTORS

There have been no material changes in the company's risk factors from those disclosed in the company's Annual Report on Form 10-K for the year ended December 31, ~~2019 and Form 10-Q for the quarter ended June 30,~~ 2020.

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ITEM 2.			UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

Period (a) Total Number of
Class A
Shares Purchased (1) (b) Average Price
Paid Per Share (c) Total Number of Class A Shares Purchased as
Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Value) that
May Yet Be Purchased
Under the Plans or Programs
(in millions)
July 1 to July 31 102 $ 168.90 — $ —
August 1 to August 31 252 170.02 — —
September 1 to September 30 107,236 168.25 — —
Total 107,590 —


Period	(a) Total Number of Class A Shares Purchased (1)	(b) Average Price Paid Per Share		(c) Total Number of Class A Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number (or Approximate Value) that May Yet Be Purchased Under the Plans or Programs (in millions)
January 1 to January 31	236	$	183.17	—	$	—
February 1 to February 28	369	192.67		—	—
March 1 to March 31	62,164	209.06		—	—
Total	62,769			—

(1)Shares purchased consist of an aggregate of ~~107,590~~62,769 shares of Class A common stock surrendered in the ~~third~~first quarter of ~~2020~~2021 to satisfy employees’ tax obligations upon the vesting of restricted stock.

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ITEM 6.			EXHIBITS







10.1						Amendment No. 4 to Credit Agreement and Bank Joinder Agreement, dated as of February 5, 2021, between Chicago Mercantile Exchange, Inc., certain lenders, Bank of America, N.A., as Administrative Agent and Citibank N.A. as Collateral Agent and Collateral Monitoring Agent. The Amended Credit Agreement, as amended as of February 5, 2021, between Chicago Mercantile Exchange Inc., certain lenders, Bank of America, N.A., as Administrative Agent and Citibank N.A. as Collateral Agent and Collateral Monitoring Agent is attached as Annex A to the Amendment.











31.1						Section 302 Certification—Terrence A. Duffy

31.2						Section 302 Certification—John W. Pietrowicz

32.1						Section 906 Certification

101						The following materials from CME Group Inc.’s Quarterly Report on Form 10-Q for the quarter ended ~~September 30, 2020,~~March 31, 2021, formatted in Inline XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Equity, (v) Consolidated Statements of Cash Flows and (vi) Notes to Unaudited Consolidated Financial Statements, tagged as blocks of text.

104						The cover page from CME Group Inc.'s Quarterly Report on Form 10-Q for the quarter ended ~~September 30, 2020,~~March 31, 2021, formatted in Inline XBRL.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CME Group Inc.

(Registrant)

Dated: ~~November 4, 2020~~May 5, 2021

By:

/s/ John W. Pietrowicz

John W. Pietrowicz
Chief Financial Officer & Senior Managing
Director Finance

3632


	Nine Months Ended, September 30, 2020
	Class A Common Stock (Shares)	Class B Common Stock (Shares)	Common Stock and Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total CME Group Shareholders' Equity		Non-controlling Interest		Total Equity
Balance at December 31, 2019	357,469	3	$	21,116.8	$	5,008.7	$	3.4	$	26,128.9	$	30.4	$	26,159.3
Net income					1,681.2				1,681.2		0.4		1,681.6
Other comprehensive income (loss)							40.3		40.3		—		40.3
Dividends on common stock of $2.55 per share					(914.5)				(914.5)				(914.5)
Impact of adoption of accounting standards updates on credit losses					(0.3)				(0.3)				(0.3)
Exercise of stock options	108		6.0						6.0				6.0
Vesting of issued restricted Class A common stock	419		(37.1)						(37.1)				(37.1)
Shares issued to Board of Directors	17		2.9						2.9				2.9
Shares issued under Employee Stock Purchase Plan	17		2.9						2.9				2.9
Stock-based compensation			69.3						69.3				69.3
Balance at September 30, 2020	358,030	3	$	21,160.8	$	5,775.1	$	43.7	$	26,979.6	$	30.8	$	27,010.4


	Quarter Ended, September 30, 2020
	Class A Common Stock (Shares)	Class B Common Stock (Shares)	Common Stock and Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total CME Group Shareholders' Equity		Non-controlling Interest		Total Equity
Balance at June 30, 2020	357,727	3	$	21,152.5	$	5,668.5	$	(13.1)	$	26,807.9	$	31.0	$	26,838.9
Net income					411.7				411.7		(0.2)		411.5
Other comprehensive income (loss)							56.8		56.8		—		56.8
Dividends on common stock of $0.85 per share					(305.1)				(305.1)				(305.1)

Exercise of stock options	41		2.2						2.2				2.2
Vesting of issued restricted Class A common stock	262		(17.7)						(17.7)				(17.7)
Shares issued to Board of Directors			0						0				0
Shares issued under Employee Stock Purchase Plan			0						0				0
Stock-based compensation			23.8						23.8				23.8
Balance at September 30, 2020	358,030	3	$	21,160.8	$	5,775.1	$	43.7	$	26,979.6	$	30.8	$	27,010.4


	Nine Months Ended, September 30, 2019
	Class A Common Stock (Shares)	Class B Common Stock (Shares)	Common Stock and Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total CME Group Shareholders' Equity		Non-controlling Interest		Total Equity
Balance at December 31, 2018	356,824	3	$	21,057.9	$	4,855.3	$	5.3	$	25,918.5	$	46.8	$	25,965.3
Net income					1,647.0				1,647.0		(0.2)		1,646.8
Other comprehensive income (loss)							(37.5)		(37.5)				(37.5)
Dividends on common stock of $2.25 per share					(805.0)				(805.0)				(805.0)
Impact of adoption of standards updates on leasing					6.9				6.9				6.9
Changes in non-controlling interest due to measurement period									0		(16.5)		(16.5)
Exercise of stock options	195		13.7						13.7				13.7
Vesting of issued restricted Class A common stock	399		(36.8)						(36.8)				(36.8)
Shares issued to Board of Directors	16		3.1						3.1				3.1
Shares issued under Employee Stock Purchase Plan	13		2.5						2.5				2.5
Stock-based compensation			70.8						70.8				70.8
Balance at September 30, 2019	357,447	3	$	21,111.2	$	5,704.2	$	(32.2)	$	26,783.2	$	30.1	$	26,813.3


	Quarter Ended, September 30, 2019
	Class A Common Stock (Shares)	Class B Common Stock (Shares)	Common Stock and Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total CME Group Shareholders' Equity		Non-controlling Interest		Total Equity
Balance at June 30, 2019	357,143	3	$	21,112.8	$	5,336.8	$	5.6	$	26,455.2	$	29.7	$	26,484.9
Net income					636.3				636.3				636.3
Other comprehensive income (loss)							(37.8)		(37.8)				(37.8)
Dividends on common stock of $0.75 per share					(268.9)				(268.9)				(268.9)

Changes in non-controlling interest due to measurement period											0.4		0.4
Exercise of stock options	33		6.7						6.7				6.7
Vesting of issued restricted Class A common stock	271		(22.7)						(22.7)				(22.7)


Stock-based compensation			14.4						14.4				14.4
Balance at September 30, 2019	357,447	3	$	21,111.2	$	5,704.2	$	(32.2)	$	26,783.2	$	30.1	$	26,813.3


	2020		2019

Quarter ended September 30	23.3	%	12.0	%
Nine months ended September 30	23.1	%	20.3	%