芝加哥商業交易所 (CME) 2014 Q1 法說會逐字稿

Welcome to that CME Group first-quarter 2014 earnings call.

(Operator Instructions)

At this time, I will turn the call over to John Peschier. You may begin, sir.

Thank you and thank all of you for joining us this morning.

Gill and Jamie will spend a few minutes outlining the highlights of the first quarter and then we'll open up the call for your questions. Terry and Bryan are here in the room also and will participate in the Q&A.

Before they begin, I will read the Safe Harbor language. Statements made on this call and in the slides on our website that are not historical facts are forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties, and assumptions that are difficult to predict.

Therefore, actual outcomes and results may differ materially from what is expressed or implied in any statement. For detailed information about factors that may affect our performance may be found in our filings with the SEC and they're are also available on the investor relations portions of our website.

Now I would like to turn the call over to Gill.

Thanks, John. Good morning, and thank you for joining us today.

I'm going to highlight CME Group's first quarter and then turn it over to Jamie to review our financials. We are pleased to announce the following results to start the year highlighted by multiple records across our industry-leading diverse portfolio of products. The major driver of this performance was strong growth in short-term interest rate volumes throughout the quarter, further sparked by a report from the Federal Reserve in late March indicating that the FOMC average estimate of the year-end Fed Funds rate in 2015 and 2016 had increased noticeably.

The Federal Reserve also indicated that their definition of the quote, considerable period, end quote, during which rates would remain low beyond the end of quantitative easing may be only six months. The Federal Reserve Chair later softened this guidance on rates, nevertheless, the Fed Funds futures curve, an implied estimate on when rates will rise, shifted upward with the market expecting the Fed Funds rate to increase sometime in mid-2015.

As we continue to see positive economic signs and an evolving desire within the Federal Reserve that extraordinary support measures are no longer needed, our interest rates options products, which allow for more sophisticated risk management of volatility and timing, have been rapidly growing.

The market reacted positively in the first quarter 2014 to this momentum. Average daily volume for our core futures and options complex was up 9%, compared to first quarter last year, mainly driven by strong growth in our two largest product areas based on volume, which are interest rate and equities.

Our focus on building out and expanding our options franchise continues to successfully grow this important part of our overall business. In total, first-quarter 2014 options ADV was 2.5 million contracts, the second highest ADV and revenue quarter ever for options, and was up 40% compared to last year.

Interest rate trading volumes rose 19% overall during the first quarter, compared to the prior-year period. Eurodollar futures and options grew 46% in the quarter, highlighted by growth of 106% in options, as well as a new daily volume record in eurodollar futures of 6 million contracts, which were traded on March 19.

While treasury futures and options average daily volume was flat in the first quarter 2014 compared to last year, treasury options volume continue to perform well and were up 18%. In addition, momentum continues to build in our Ultra T-Bond futures and options product, which had record quarterly average daily volume of 104,000 contracts, which are up 22% compared to the first quarter last year.

April was a very strong month for our interest rate complex, with average daily volume up almost 40% for the month versus the same period last year, highlighted by growth of more than 70% in eurodollar futures and options for the month. Our eurodollar complex is a clear choice for the market to express its views of the FOMC's policy.

Over the last 12 months, open interest in eurodollar options has doubled. The key driver here is the likely end of quantitative easing in the fourth quarter of 2014, which is already shifting attention to the next big policy decision, which is when and how much to raise the target Fed Fund rates. With the rate decision coming into focus, market participants have begun to adjust their risk management activities in the short end of the interest rate curve.

Our interest rate swap over-the-counter complex has also benefited from the Fed’s actions, as well as our continued efforts to add new capabilities. Open interest continues to trend upward, increasing over 50% from the end of the year to $13.7 trillion at the end of April.

Over 440 global market participants have cleared at CME Group taking advantage of the most capital efficient solution in the industry. Eight clearing members are now live with the service and over 30 customer accounts are already benefiting from this scalable solution. These clients using our portfolio margining service are saving on average over 40% through margin offsets, totaling close to $2 billion of efficiencies.

Average daily notional volume cleared in the first quarter 2014 was $125 billion, with a new daily record of $264 billion cleared on March 20, 2014. Although we have experienced fluctuations in market share for our dealer-to-customer IRS notional volume cleared, we have experienced a steady increase in the amount of daily trades executed in our market, from about 1,200 a day in Q4 last year to 1,500 in Q1 of this year, at a level that was consistent with our primary competitor.

The number of trades cleared has a much higher correlation to revenue than does notional value of cleared trades. Jamie will explain this when he discusses the financials.

As I mentioned, equities is a strong performer in the quarter, which is continuing into the second quarter. During Q1, we saw the benefits of having a broadly diversified equity product line with our overall equity average daily volume up 11% versus last year, including growth in excess of 30% for our NASDAQ, Dow, and the Nikkei index products. Equity E-mini Options also rose 66% during the first quarter, compared to Q1 last year.

Turning to foreign exchange, the global FX market continues to suffer this year driven mainly by the FX benchmarking scandal and extremely low levels of volatility. While our FX average daily volume was down 19% in the first quarter, compared to Q1 of last year, we continue to outperform the broader OTC FX market where we saw EBS's FX volume down about 34% year over year.

And based on our own customer analysis, as well as from recent research notes from Greenwich Associates, we feel that the market is increasingly adopting exchange-traded FX futures, which directly ties to our European exchange strategy.

We launched our London-based derivatives exchange, CME Europe, earlier this week. Securing regulatory approval to launch CME Europe marks a critical milestone in our global growth strategy.

Our European clients are increasingly looking for ways to manage risk and access liquidity in their local jurisdiction and launching a dedicated European exchange enables us to offer products tailored to their specific needs. This allows us to access a new non-US client base, and with the move to central clearing, coupled with London’s role as the center of global FX trading, opening CME Europe for business strengthens our competitiveness in this high growth area.

Also building on our globally-relevant products, we will launch a North American physically delivered aluminum futures contract that will begin trading in the second quarter of this year, pending all regulatory approvals. This new aluminum futures contract will also offer global aluminum market participants a new tool for managing their exposure to volatile North American prices, while giving them access to physical aluminum at a number of CME Group-approved warehouses across the US.

Moving on to our other products, the energy market slowed after the fast start to the year. The natural gas average daily volume was very strong in January and early February, with the especially cold winter in the Midwest and the Northeast. The high volatility experienced, however, has dropped significantly, with overall average daily volume in the energy sector for the quarter basically flat.

And, lastly, before I turn the call over to Jamie to discuss our financials, I want to touch on the recent news surrounding high frequency trading and the impact in our markets. Let me start by saying that we are part of a highly regulated industry and the most important thing for CME Group is the integrity of our markets for each and every participant. Any discussion of how to enhance market structure and efficiency, whether for diluted, equities, or other markets, is an important one to have.

It is also important to acknowledge that markets continually evolve and therefore discussions about safeguards and efficiency must also evolve. CME Group has been and will continue to be an active leader in these discussions. Likewise, we have been at the forefront of market and system innovations designed to safeguard and protect clients.

As markets have become faster and more highly automated, CME Group has developed an array of capabilities to manage risk and volatility and mitigate market disruptions. Those include credit controls, stop-loss logic that was utilized during the flash crash, velocity logic, and messaging volume controls that will automatically reject anomalous orders caused, for example, by an order entry error or a malfunctioning algorithm.

CME Group's regulatory databases capture hundreds of millions of orders and trade messages, market data messages, cleared trade records, and position records each and every day, which are integrated into other reference data we maintain to provide a comprehensive view of our CME Group markets. We can identify who is doing what, for whom, and when, down to the millisecond.

Orders entered via automated systems and the teams who operate the automated systems are identified in the audit trail. In our markets, high-frequency traders are not afforded any special access or information that is not available to all market participants.

HFTs do not have access to, or information about, customer orders before orders reach the central limit order book. Market data is made available to all subscribers at the same time, and they have a number of options to choose as to how they want to receive it.

And lastly, it is important to remember that market participants, regulators, and academics have been discussing automated trading for years. Significant analysis has been done highlighting the benefit of these types of participants existing in our markets and given the liquidity they provide, which ultimately tightens the bid/ask spread and reduces costs.

The team, including our Chairman, is prepared to answer any detailed questions on this topic that you may have. So please feel free to ask us during the Q&A.

With that, I will now turn the call over the to Jamie to discuss the financials.

Thank you, Gill, and good morning, everyone.

As Gill mentioned, volume grew nicely during the first quarter, driven by rates and equities. First-quarter ADV was up 9%, revenue was up 8%, adjusted diluted earnings per share was up 14%, and the operating margin was 58%.

Adjusted EPS for Q1 of $0.83 excludes FX fluctuations, prior period favorable tax results, and changes in deferred taxes due to apportionment factors outlined in our press release. The rate per contract for the first quarter with $0.767, down from $0.78 last quarter.

The main driver of the drop overall was strong growth in our lower-priced interest rate contracts and we saw a higher proportion this quarter from members, with member volumes growing 22% and nonmember volumes growing 15%. The transaction fee pricing changes we implemented beginning this year added about $0.019 per contract within the 2% to 3% range we expected.

OTC swaps revenue totaled $12.8 million, up 19% versus last quarter. Within interest rates swaps, as Gill mentioned, because of the bifurcated pricing structure in OTC, the trade count ends up being the best indicator of revenue.

In Q1, we captured an average of about $128 per OTC trade, and we cleared approximately 1,500 trades per day. In 2013, we averaged approximately $130 per trade.

In terms of market share on trade count, we were at 49% in Q1, up from 48% in Q4 2013, and 47% for all of 2013. We plan to release the average daily trade count on a monthly basis which should help you in terms of modeling.

Market data came in at $89 million, up 17% versus last quarter. The screen counts were fairly stable with attrition during the quarter of less than 1%, despite the pricing change that took effect on January 1. Additionally, the elimination of the fee waiver for new clients took affect beginning April 1, which should have a mitigating impact on overall terminal attrition going forward.

Moving on, first-quarter operating expense was $325 million, excluding a $3.1 million FX benefit and $800,000 of deferred compensation expense, both of which we plan to remove for comparison purposes each quarter. Adjusted history, excluding these and other items previously identified for the last five quarters, is available on the income statement data file on our website. This result compares favorably to the Q4 2013 results.

Our full-year 2014 expense guidance remains at $1.31 billion, which assumes a certain level of license and fee sharing expense, as well as bonus expense, both of which generally vary with volume. Q1 non-operating expense was $8.9 million, excluding the deferred compensation impact.

We mentioned in our last volume release, that we did not receive a dividend in Q1 from BM&F, similar to last year. Interest expense is down to $33.7 million based on the payoff of a portion of our debt in February.

Lastly, our index joint venture income for the quarter was the best yet, partially driven by increases in ETF assets under management and exchange traded derivatives. Turning to taxes, the effective rate for the quarter was approximately 37.4% on a pro forma basis.

And now the balance sheet. We had approximately $1.1 billion in cash at the end of quarter, reflecting payment of our $750 million note maturing in February, and payment of our $870 million fifth dividend in January. This brings our total 2013 related dividends to $1.5 billion.

Over the last 2.5 years, since we implemented the new dividend policy, we have returned $2.9 billion to our shareholders in the form of dividends, representing in excess of 10% of our market cap. Lastly, during the first quarter, capital expenditures net of leasehold improvement allowances totaled $37 million.

In summary, we are keenly focused on planting the seeds for future growth, while also ensuring that our core business is positioned to benefit as various macro themes continue to play out.

With that, we'd like to open up the call for your questions. As we have, over the last few quarters, given the number of analysts who cover us, we ask that you limit yourself to one question. Please feel free to get back into the queue, if you have further questions. Thanks.

(Operator Instructions)

Rich Repetto, Sandler O'Neill & Partners.

Good morning, and first thank you for the detailed comments on HFT, Gill. I guess my question is to Terry because you are most in contact with the regulators and the politicians, as much is anyone I know. From your perspective, do you think that they separate the HFT issues from the equity market and the futures market and just -- not to put you on the spot, but what do you think your exposure is if there was HFT regulation, say, by the SEC, would it spill over? Would it spill over to futures or do you feel like you have exposure there?

You know, Rich, I would say that in the years that I've been in Washington, and I just got back again late last night. Gill and I were both there, and Bryan. They can have an opportunity to lump everything together, and that's just the nature of Washington, DC. But what we do, and I think we do a very good job at it, is educating the differences in our model versus the equity models, and we didn't do that when Michael Lewis' book came out. We've been doing that for 10, 12 years now.

I think we -- but unfortunately Congress turns over every couple of years so you always have that risk and exposure. I feel very comfortable though with the people that we've been dealing with and talking with on the hill that they understand the differences at a certain level. There will be a potential hearing coming up in the Senate Ag on HFT which I will be participating on, and then there should be another one coming up in the Senate Banking which I'm not sure of the date of that. Again, we will use those opportunities to continually draw the differences between our market structure and the equity market structure so we don't get swept into some kind of reform that doesn't apply to our business.

And, Rich, just to add to that perspective of what the Chairman just said, the equity futures that this group of traders, so-called HFT traders, are less than 3% of the overall revenue of the firm.

Understood. Thank you, and I agree with you, Terry. There's been some reckless rhetoric out there on the subject.

Yes. There really has. Thanks, Rich.

Alex Kramm, UBS.

Can you give us a little bit more detail on what you're seeing out there in terms of futurization? I don't think you talked about it much in the prepared remarks this time. And maybe give us some data that you might have on terms of new participants that you're seeing for the first time trading futures, and also maybe rope this in into some of the new CFTC mandates and how those are going to be evolving over the next few months, and if you think that could be a driver of people finally saying, okay, this is getting too complex, let's start using futures here. Thank you.

I will start and Gill will add on to it. But you can see in terms of our overall growth in our open interest on the futures side has trended up very nicely, over this past quarter, in particularly. And you will see very much so a strong trend across the eurodollar curve as well as the treasury's on the open interest. I would point you to -- in terms of new users coming into the market, if you look at the commitment of traders report as it pertains to asset managers, there is a very significant trend in terms of their increase in open interest from over $1.8 million in contracts to about $3.6 million in contracts, and that ties directly into our interest rate futures product line.

There's definitely, I think, continues to be some confusion and trepidation in the context of the CFTC rules themselves and what the requirements are going to contemplate for the end-users, and we're seeing that having a positive effect, quite frankly, in terms of turning towards the usage of our futures.

Just to add to what Bryan just said, Alex, I think we look at the deliverables to our futures over the past month, the open interest is up about 38% and to 108,000 contracts or so, and as an added dimension here with the focus on the futurization effort on the rate side, but we also seeing some positive trends on the FX side with the market investigations that are going on the open interest [on forwards] has come up in spite of the low volume on the FX side. That's an added dimension that we have not seen until a short while ago.

Excellent. Thank you.

Sure.

Niamh Alexander, KBW.

If I could just come back to the high frequency trading question. Terry, part of this is that the whole equity is very different -- a very different market structure; we get that. But part of it was the latency advantage that the high frequency trading firms had had and there's an argument that that shouldn't be the case and whether it's unfair or the appearance if it's fair.

But what makes sure -- what, if any, discussions that you might be having or hearing with regards to potentially limiting co-location, services or limiting some of the latency advantages, like maybe forcing everybody to slow down to the same pace, everybody being CME or really forcing you to eliminate some of the advantage. I know you don't have a huge co-location business right now but people can co-locate besides some of your data centers. If co-location was something that they really -- and the advantage of it wanted -- was something they wanted to pressure, is that something you think could significantly impact that customer group for CME?

I'm sorry, I just want to understand your question. I using that co-location could come under pressure?

Yes, if some of the regulators like the New York Attorney General, for example, is kind of suggesting that it's unfair and this is a practice that should be ended.

I think that when they dive into what co-location facilities do, they will understand that they are the fairest system in the world and that's what we strive for at the CME. So when we bring -- we bring regulators, we bring legislators out to our co-location facility and we show them how there is no difference to the match engine no matter where you're at in our co- location facility because of how we operate the facility. And I think that that is something that has become a huge benefit.

If you were to say co-location needs to go away and your server is going to be in some building and someone else finds out where that building's at, that gives that particular individual the only advantage of being closer to the server. I think people are understanding that. I do think that co- location got a bad rap, for a lack of a better term, during this book because it appeared that some of these facilities may have been doing favors or giving speed to certain participants and not to others. That's not the model that CME deploys. I'm not sure if that answered your question completely.

I think if co-location did not exist, there would be a lot of folks buying up space around the facility just to get in there. And to the Chairman's point, it's actually a more level playing field because it does exist and anybody can participate, not just the very large -- .

And I think to that point, Gill, when we were talking yesterday with some regulators, we said that if in fact we didn't have co-location facilities today, you would probably mandate them by law for us to have them.

I would just add one more point. You mentioned about possible favoritism on data access or data distribution. We don't provide any proprietary feeds or separate feeds to any market constituent. All of our data comes out through one consistent mechanism; one type through all the marketplace.

Okay. Thank you so much.

Kenneth Hill, Barclays.

I know you're just getting going here in Europe with the exchange, but was wondering how you think about leveraging that clearinghouse in exchange in Europe as you expand into other regions over the longer term. So I was hoping you could lay out how you see not only marketing and sales efforts unfolding in Europe but also in other regions like Asia, potentially leveraging that European hub.

I'll start. If you look at the clearinghouse and the exchange feeds, we just launched as we know (inaudible) this week I think market participants are just getting their feet on the ground. I think by the end of the month next month we will see the participants in their full capacity participating. There are some connectivity issues within the firm's [dan cells] but once we sort those out, we will start -- and I think in the words of our head of Europe, it has got off to a gentle start but the bigger question is what's the plan here.

And if you look at where it is located in terms of both dimension engine and the CCP and you look at the sales force that CME has deployed both in Europe as well as in Asia, as we develop and continue to innovate, we will have an option, depending on client needs, as to where to list the various and sundry products as we develop them. You could find as customer needs are European-based, we would put them there with full access for everybody or we'll let them here in the US. We have an additional platform in which to list any kinds of new innovations as we see fit. Beyond that, I don't think I have anything to share yet.

Okay. Thanks for taking my question.

Jillian Miller, BMO Capital Markets

Energy activity has been somewhat weak in March and April and you mentioned in your remarks that volatilities declined in that gap but it just seems like there might be something more going on there. I don't know if some of the destruction in the commodity markets with the banks is having an impact. Any color on the dynamics there would be helpful and thoughtful on how we should be thinking about energy volumes shaping up over the rest of 2014.

I think the low volatility in the nat gas is not necessarily a structural issue. It's largely driven by demand and supply. I think there are various and sundry things happening in the nat gas markets around the world, not just in Europe and the US, but Asia, in particular, is going to be an area of focus where growth is concerned. And to your other part of your question, where you see there may be something going on.

I think structurally the biggest thing that's going on and the biggest debate in the energy marketplace at this time, the supply issues as it relates to Brent, and there's a lot of debate around that and also the oversupply issues that we have here in the US that as we have spoken about the oversupply at the Oklahoma facility has been really significantly, and now the oversupply condition is on the Coast and so it puts a lot of pressure on the authorities with respect to what to do with that crude. A lot of it is being refined and exported, but it increases the pressure on the debate to allow for the expansion of crudes. Structurally, that's what is going on.

Yes, Gill, just to add that a little bit. I think that the other part of her question was what about the banks coming out of the market a little bit, and I think when you look at the -- Gill outlined it very well when he gave you the fundamental reasons. If the banks were in or the banks were not, the fundamentals would be the exact same as they are today. If, in fact, the fundamental situation changes in the energy market, the volumes will follow whether the banks are participating or not.

On the point of fundamentals, there's still significant potential fundamental factors that could result in higher or more than the current volatility levels that we're experiencing and seeing higher volatility return to the space, when looking at weather, the Russian situation, and the huge US natural gas inventory shortfall, other global initiatives or concerns with respect to Venezuelan unrest. All of these things could have an impact on volatility going forward.

Thank you.

Ken Worthington, JPMC.

Margins, 58% this quarter, really nice improvement from what we've seen over the last couple of quarters, and I know you've given guidance for 2014. As we think about expenses longer term, you've gone through this period of elevated investment over the last couple of years. This investment is going to season.

It would seem like there's the potential for some disproportional operating leverage if you get the boost in revenues from the OTC side, the interest rate side. And so I guess my question is does this concept have any merit or does the incremental revenue continue to get spent on an accelerated pace on the next investment ideas.

Ken, this is Jamie. I think there's a very big focus internally on expense. We've said before that we look over the long run to grow our expenses and control them in a way that we're going to grow them probably in the mid-single digits, and when you have that kind of expense control and you lay on top of that growth in volumes in the out years moving forward, you're right. There's a significant amount of operating leverage still alive in the model going forward, and we would expect that to accrue to the benefit of our shareholders.

Okay. Great. Thank you.

Christian Bolu, Credit Suisse.

Which is the best of the growth of the options business? What would it take to increase the penetration asset classes such as interest rates and energy? Is it a case of simply building the right tools for market participants or are there kind of wider market challenges that you need to overcome?

I think if you look at the electronification percentage of the options products that we had and also look at the types of investments that we have put into our matching engine over the years, the investments of the market practices that lend themselves more easily to electronic trading have taken place. Our electronic percentage has gone up from 35% last year to almost half this year and where they continue to state on the floor is when you're talking about trading strategies that are extremely complex and so they lend themselves at this time more easily than on the floor.

When you see other markets around the world that have it seems -- have converted 100% to an electronic marketplace, in reality it's a call around marketplace with five or so market-makers making markets on the phone and using the matching as in simply to book the trade, and that's not the case here. The [shift] rules that we have bifurcate between electronic trading, pit trading, as well as block trading.

I would add to that that we have an intensified emphasis in terms of augmenting our functionality within the match engine to handle the most complex strategies and multi-legged transactions. We're in the process of rolling out that additional functionality and working with the marketplace to bring more and more of that into the electronic platform.

Thank you.

Alex Blostein, Goldman Sachs.

I wanted to dive into this FX markets for a second. Clearly volumes year to date have been somewhat soft and then April seemed pretty white as well. Is that a function just of volatility or do you guys see something else that's maybe structurally driving volumes that are lower.

We think that a lot of it is the functional aspects of the market and cyclical factors that are affecting the performance of the overall FX market. We're seeing unprecedented low volatility which is hampering volume in that product sector. There's a number of other fundamental factors that impact the market users themselves in terms of their participation. We're seeing -- because of this low volatility and I also think the issues that are affecting the marking of the FX contracts in and of themselves has caused some pullback from certain segments of the market, particularly in the hedge fund and central bank area.

However we view this as being short term, a challenge, and we're very confident about how with certain changes from a structural perspective, how this could be very positive in terms of our overall draw into our marketplace. You know, it's a difficult comparison in terms of looking at it from Q1 of 2013 versus today. Volatility in volumes were driven largely based on the ongoing uncertainty surrounding the eurozone crisis and the debt ceiling standoff in Washington. Those factors have somewhat changed to date.

With respect to capital rules, clearing mandates, we're seeing an increasing interest in terms of shifting customer interest that we hadn't normally seen in our futures product coming into our futures product so we view that that bodes favorably for the strategy that we've undertaken in terms of continuing to build that complex while also offering some alternatives on the European sector.

Great. Thank you.

Chris Allen, Evercore.

I just wanted to follow up on Gill's answer to Rich's question, just clarify. HFT was less than 3% equity futures revenues. Just wondering how you guys define HFT? Whether you're excluding electronic market makers. As I recall, the last disclosure gave around customer segmentation [prog] trading including [azo], as I recall, was over 40% of your overall business, so just any color on that would be helpful.

Sure, Chris. This is Jamie. That was a very broad category, as you noted. When we look at it, HFT is not really an extremely well-defined term. That said, we did an analysis based on Q1 data. We looked at -- we filtered firms by speed, order modifications, and by volume of orders processed. We then looked at their automated trades.

We then took a look at that and bumped that and looked at it versus where our customer facing folks felt firms fell and kind of try and give weight a little bit there. And looks like based on that analysis that these firms represent about 30% of our volumes and less than 15% of our total revenues. And included in those numbers are volumes related to market-making that happens -- that they perform. So it's a -- I would say a fairly conservative number.

Thanks, guys.

Neil Stratton, Citi.

I just had a question on the revenue per contract. Obviously, it'll shift based on product mix and client type and such. Is there any broad trends you expect to play out over the next several quarters? Thanks.

I think when you look at the RPC, it's all those mix issues, right? So you're certainly going to -- if you expect the interest rate volumes to continue to grow in an outside play versus other quadrants, that would weigh on the overall rate because they are a lower contract. As markets -- as people move from OTC perhaps into futures, we are likely to see some over time pick up in non-members. That would be a positive for the rates and certainly we put the pricing changes in this year and that was a positive starting in January.

And then, when I look -- if I look down into energy and I know there was a question about that earlier, but on energy there's some good non-US growth in energy volumes and actually some good non-member growth in energy volumes, as well, in this past quarter, kind of masked by the overall flat results.

Gaston Ceron, Morningstar Equity Research.

Thanks for the additional color and disclosure on HFT. I realize it must very much feel like beating a dead horse, but just going back to it. Hopefully one last time this morning. Jamie, on that number that you gave, I think you said it was less than 15% of total revenue I guess for the first quarter. I just want to be clear. Is that across all the revenue lines including market data, access fees, et cetera? Or is that just within clearing and transaction?

That's across all.

Okay. So across all the revenue lines, it's less than 15% of first quarter revenue?

Correct.

Okay. Thank you very much.

At this time, I'm showing no further questions. I will turn the call back over to the speakers.

Thank you all for joining us this morning. We look forward to talking to you again in the next quarter. Thank you.

Thank you. This does conclude today's conference. We thank you for your participation. At this time, you may disconnect your lines.