CHICAGO -- Media Derivatives ("MDEX") is pleased to announce that it has received approval from the U.S. Commodity Futures Trading Commission ("CFTC") as a designated contract market. Media Derivatives will operate under the name The Trend Exchange ("TrendEx"). TrendEx is the first new exchange to offer innovative products that has been approved since 2004 and one of only 7 US based commodities exchanges. TrendEx is primarily focused on the development of a variety of products to benefit the entertainment industry with one if its initially proposed products being designed to help mitigate risk and enhance the successful financing of motion pictures through trading of opening weekend domestic box office receipts. TrendEx, like other CFTC approved exchanges, will consider other products to offer beyond those of just the media industry.
Founder and CEO Robert S. Swagger said The Trend Exchange welcomes collaboration from all segments of the entertainment industry in the development of market-based products that provide maximum risk management potential for the participants. Launch of the exchange's first products is anticipated in the third quarter.
"Like all Americans, we cherish the entertainment industry," Mr. Swagger said. "We believe that our products, designed in partnership with the broad industry constituency, will help better manage economic uncertainty and financial volatility, thus enhancing opportunities for success."
Mr. Swagger added: "The recent attention to our initially proposed product is normal and healthy. Historically, initial product skeptics have eventually become the greatest adopters through a process of time, education and communication that demonstrates the many benefits of futures market for the US Economy. Now that our exchange is approved, we will resume the work we've been doing throughout the entertainment industry."
By designing its products for institutional traders and commercial users, TrendEx intends to fulfill critical financing needs. Historically production companies have had no effective way to minimize the risk of producing major motion pictures, which cost on average $107 million per title.
"The Trend Exchange will fulfill this crucial risk-management need by utilizing the time-tested exchange-traded futures market model that has served agriculture, industry and commerce in America for nearly two centuries," Swagger said. "The regulatory review and oversight of the CFTC is rigorous - and necessary to inform and protect all participants in these markets. We look forward to working collaboratively with all parties to set the highest standards for these new risk-mitigation markets. Furthermore, we wish to thank the CFTC Chairman, Commissioners and staff for the countless hours of hard work and dedication throughout this process."
The Trend Exchange is privately funded by Veriana (www.veriana.com ) and is in discussions with several key industry participants regarding what it deems as possible strategic partnerships. The company's directors and advisors include prominent members of the entertainment and financial services industries. In addition, the exchange's senior management is comprised of many well known professionals from the Chicago futures and options exchange community. The Trend Exchange's corporate offices are located in Scottsdale, AZ with exchange operations office in Chicago.