CME Group Inc
NASDAQ:CME
| US |
|
Johnson & Johnson
NYSE:JNJ
|
Pharmaceuticals
|
| US |
|
Berkshire Hathaway Inc
NYSE:BRK.A
|
Financial Services
|
| US |
|
Bank of America Corp
NYSE:BAC
|
Banking
|
| US |
|
Mastercard Inc
NYSE:MA
|
Technology
|
| US |
|
UnitedHealth Group Inc
NYSE:UNH
|
Health Care
|
| US |
|
Exxon Mobil Corp
NYSE:XOM
|
Energy
|
| US |
|
Pfizer Inc
NYSE:PFE
|
Pharmaceuticals
|
| US |
|
Palantir Technologies Inc
NYSE:PLTR
|
Technology
|
| US |
|
Nike Inc
NYSE:NKE
|
Textiles, Apparel & Luxury Goods
|
| US |
|
Visa Inc
NYSE:V
|
Technology
|
| CN |
|
Alibaba Group Holding Ltd
NYSE:BABA
|
Retail
|
| US |
|
3M Co
NYSE:MMM
|
Industrial Conglomerates
|
| US |
|
JPMorgan Chase & Co
NYSE:JPM
|
Banking
|
| US |
|
Coca-Cola Co
NYSE:KO
|
Beverages
|
| US |
|
Walmart Inc
NYSE:WMT
|
Retail
|
| US |
|
Verizon Communications Inc
NYSE:VZ
|
Telecommunication
|
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
193.43
244.8381
|
| Price Target |
|
We'll email you a reminder when the closing price reaches USD.
Choose the stock you wish to monitor with a price alert.
|
|
Johnson & Johnson
NYSE:JNJ
|
US |
|
|
Berkshire Hathaway Inc
NYSE:BRK.A
|
US |
|
|
Bank of America Corp
NYSE:BAC
|
US |
|
|
Mastercard Inc
NYSE:MA
|
US |
|
|
UnitedHealth Group Inc
NYSE:UNH
|
US |
|
|
Exxon Mobil Corp
NYSE:XOM
|
US |
|
|
Pfizer Inc
NYSE:PFE
|
US |
|
|
Palantir Technologies Inc
NYSE:PLTR
|
US |
|
|
Nike Inc
NYSE:NKE
|
US |
|
|
Visa Inc
NYSE:V
|
US |
|
|
Alibaba Group Holding Ltd
NYSE:BABA
|
CN |
|
|
3M Co
NYSE:MMM
|
US |
|
|
JPMorgan Chase & Co
NYSE:JPM
|
US |
|
|
Coca-Cola Co
NYSE:KO
|
US |
|
|
Walmart Inc
NYSE:WMT
|
US |
|
|
Verizon Communications Inc
NYSE:VZ
|
US |
This alert will be permanently deleted.
CME Group Inc
You don't have any saved screeners yet
Good day, and welcome to the CME Group Third Quarter 2020 Earnings Call. At this time, I would like to turn the conference over to John Peschier. Sir, please go ahead.
Good morning and thank you all, for joining us. I’m going to start with the Safe Harbor language, and I’ll turn it over to Terry and John for brief remarks, followed by your questions. Other members of our management team will also participate in the Q&A.
Statements made on this call and in the other reference documents on our website that are not historical facts are forward-looking statements. These statements are not guarantees of future performance. They 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.
More detailed information about factors that may affect our performance can be found in our filings with the SEC which are on our website. Also on the last page of the earnings release, you will find reconciliation between GAAP and non-GAAP measures.
With that, I would like to turn the call over to Terry.
Thank you, John, and thank you all for joining us today. I wish you all the best, you and your families during this challenging situation for many around the world. My comments today will be brief as John said so we can spend majority of our time directly addressing to questions. We released our executive commentary this morning which provided extensive details on the third quarter. Also as John referenced, I have John, Sean, Derek and Julie Winkler were with me this morning and we all look forward to answering your questions.
We continue to see historically low levels of volatility in several of our asset classes, which began in the second quarter. During the third quarter, we averaged 15.6 million contracts per day down from 17.6 million contracts per day in the second quarter. We're fortunate to have a broad product portfolio. During the third quarter we saw strength in our equity business, our higher rate per contract metals and agricultural products delivered volume growth in Q3 and FX volume recovered, an average of 100,000 contracts per day, higher in Q3 than Q2.
Our market data business during the quarter had exceptional results with revenue of $139 million, the highest quarter in our history. We continue to launch innovative new products. And we have prepared for the cutover a BrokerTec onto Globex later this quarter.
We remain committed to achieving capital and operational efficiencies for our clients. Clearly, the lack of volatility is impacting two of our largest asset classes, rates and energy. That is the current reality but not a permanent one. We have intensified our efforts on the expense side, which is something we can control. As John will discuss in a moment, we are reducing our 2020 expense guidance by $70 million from the initial guidance we provided in February. Realizing we are in a tough environment, we also plan to deliver very strong expense management going into 2021.
With that short intro, let me turn the call over to John to talk a little bit about the financial results.
Thank you, Terry. With our strong expense discipline and the remote working environment, we finished the third quarter with adjusted operating expenses excluding license fees of $386 million down 6% compared to the same period last year, and down 5.5% year-to-date. We are extremely focused on actively managing our costs as Terry mentioned. This expense level reflects the entire company effort to ensure that we are spending as efficiently as possible in the face of a tough operating environment. Our adjusted diluted EPS for the quarter is $1 38 and is $5.34 through three quarters which is up slightly from last year.
Based on our outlook for the rest of the year, our guidance for adjusted operating expenses for 2020 excluding license fees has been reduced to $1.575 billion down from $1,645 billion, which is the midpoint of our initial guidance at the start of the year, and down $20 million from our full year estimate we updated last quarter.
Finally, we're beginning our budgeting process for 2021 and we expect the intense expense focus to cover -- to carry over into next year. We recently let our employees know that we are deferring promotions for now, freezing wages going into next year, and we are looking at other opportunities to reduce discretionary spending.
With that short summary, we'd like to open up the call for your questions based on the number of analysts covering us, please limit yourself to one question, and then feel free to jump back into the queue. Thank you.
Thank you [Operator Instructions] Thank you. Our first question will come from Rich Repetto with Piper Sandler.
Yes, good morning, Terry. Good morning, John. And I hope everybody is -- good morning. Hope everybody is safe and well. You talked about the environment -- the low interest rate environment, but you do have this migration cutover in the fourth quarter. So I guess, Terry besides the savings that you expect from it, I'm just trying to get a better idea of what you think the behavior changes, like whether you've sort of got a better feel for the margin savings and could we see a change in behavior from it? And also, I know there are some new regulations from the SEC out on treasury trading platforms and whether that -- recognizing them as ATS. Will that have any impact on BrokerTec and cutover?
Yes, thank you Rich, and I hope you and your family are well. I'm going to ask John to come up. But before I do that, I'll make a few remarks as it relates to what I perceive as potential behavior changes as the platform comes on to Globex. I am, like everybody around this organization, very excited about having BrokerTec onto the Globex platform to deliver the efficiencies that we've talked about when we first made the announcement of the transaction, I don't think you can underestimate the value of cash and futures on a single platform. So we really are against the liquid platform like futures, because we've never seen it before.
So even though the rates, as we've discussed are in a very disappointing place as far as the Fed policies go, it doesn't mean that people will stop managing their rates, we're still continuing to see a tremendous amount of issuance going, especially into the long end of the marketplace, we're going to see that. And we are excited by the BrokerTec integration onto that.
So the behavior, I've heard a lot of positive things from the client base as how they're looking to manage risks, as it relates to the other questions around the SEC, and others that you asked, I’ll ask John to make a comment. But behaviorally, I think that the participants are excited about having this single point of contact to manage that risk.
Terry, this is Sean jumping in. Can you hear me?
Yes. Yes, go ahead.
Yes, so I'll jump right in then in. In terms of the migration to Globex. I'm very excited about the Globex technology, customers are very excited about the Globex technology and the significant increase in determinism that it offers to our client base.
In addition to that, I'm very excited about the functionality that we're going to have available to us on Globex for BrokerTec cash markets that wasn't available previously, on the previous technology.
In particular, I'm very excited, we do plan on launching, shortly after we migrate BrokerTec to Globex, we will launch something called RV or Relative Value trading. This, for the first time, will allow Curve order types. It will allow you to trade the spread between different securities.
So simultaneously buying and selling different securities such as two-5s, five-tens, tens-bonds. By doing that, actually, there is a number of different values that will be added to the market first. You'll no longer have to leg those spread trades.
We believe that 10% to 15% of the Treasury market is probably done in curve trades. Although today on BrokerTec, they are done as legged individual trades. So first, you'll eliminate that legging risk. Secondly, by putting in a spread order type, we're going to have that spread order type at a much tighter minimum price increments than outright contracts.
Third, we're going to use implied functionality on Globex, that has been extremely successful in our Eurodollar futures for example, where when you have an outright order, let's say two year notes, and you've got a spread order in twos versus fives that then implies an outright order in five, five year notes.
So we're very excited about it, reducing risk in the trade, lowering the cost of the trade and enhancing the overall liquidity of the platform. So we are very excited about that. I might mention a couple of other things that we're investing at the same time.
Now another platform we are investing in the EBS side is something we call QDM 2.0 or Quote Driven Markets to 2.0. This is a brand new technology state of the art technology that will allow us to have much faster round trip times and much better technology overall, for the bilaterally traded foreign exchange market. So we're equally excited about that. We do expect that to be fully rolled out sometime next year, we have begun rolling it out now. Last maybe I'll mention before stopping. We're also very excited about new analytics that we are able to deliver to clients having both the cash and futures platforms that Terry mentioned earlier.
So next week, we're going to be launching a new tool on our EBS Quant Analytics platform. EBS Quant Analytics is a total cost to trade or a transaction cost analysis for the foreign exchange market. It currently allows you to look at the bid offer spreads and the depth of book in the bilaterally traded market on EBS that we're using your current chosen liquidity providers, it allows you to look at all the other liquidity providers that you are not currently using, it also allows you to look at the central limit order book.
So we're in the process of adding futures to that analytical tool. In particular, we're going to be adding something called market profile. So this will show the great value of having both the futures liquidity pool and the cash liquidity pool. And it will show you the advantages of and really the need for anyone who transacts globally to trade in both liquidity pools in order to minimize the overall cost.
So we're very excited about all of the technology investments that we're making and the growth that should provide the platform.
Thanks, Sean. Rich, I hope -- hopefully that gives some color to how we feel about the migration and the cutover and behavioral issues. I think your other part of your question was around the SEC. And Sean, did you touch on?
Yeah, I apologize. In terms of the FCC, the new regulations will in terms of Reg ATS on cash mortgage platforms, we already had here to most of the regulations. There are a number of platforms that do not. So while there are exemptions for U.S. Treasuries, certain exemptions under SEC rules for U.S. Treasury platforms, since historically, BrokerTec traded Canadian government bonds as well as mortgages. NEX and BrokerTec did not take advantage of those exemptions. So there may be some new adherence that is required. BrokerTec generally already adheres to the rules that we expect to be required.
Thanks, Sean.
Thank you. Thank you very much.
Thanks Rich. Appreciate it.
Thank you. Our next question comes from Dan Fannon with Jefferies.
Thanks. Good morning. My question is on market data, obviously a good quarter you highlighted subscriber growth and kind of some of the demand trends. Can you talk about the kind of the type of customer that the incremental subscriber here and maybe the momentum or outlook for this business as we think about, heading into next year 4Q and into next year, please?
Julie?
Sure, thanks for the question. Yes, we had a great quarter in Q3 revenue up to $139 million. And that was the majority of that was driven by a higher subscriber counts for that real time data. And so what we're seeing there is that as many firms are continuing to be in a work from home environment, it is necessitating additional access to our real time data. We're also seeing good demand, though for data being used in automated trading solutions, as well as more usage of CME data into the inputs, into other financial products and services.
So I think it's, largely driven by this work-from-home environment but still continues to be strong. I think as we look forward, we are definitely focused on integrating the data that came over from NEX as well. We're continuing to build out our cloud based distribution capabilities. We talked last quarter about CME Smart Stream.
And we've been pleasantly surprised there. I would say about the interest from customers for that it has exceeded our expectations. And I think they're it's about the scalability of putting data into the cloud, it being much easier for customers to access. And so we continue to have a good pipeline of clients coming into that. And we're also continuing to work on strengthening our market data policies and pricing, and also, the enforcement related to those activities.
And lastly, working on our benchmark business and that includes our participation in the ARC SOFR term rate RFP that's due later this month.
Okay. Thank you.
Thank you. Our next question comes from Alex Kramm with UBS.
Yeah, hey, good morning. Just quick one on the expense side. One, obviously we saw the updated guidance, I think it assumes a little bit of a 4Q increase or maybe just talk about that, the seasonality there. And then -- but more importantly, maybe this is a little bit early, but as we think about 2021, can you just remind us how much savings you had this year from COVID, i.e., lower T&E, etcetera that you expect to come back next year? Obviously the timing is uncertain, but any -- how should we think about kind of like savings that you had that will not recur next year because of COVID?
Hey thanks Alex, this is John, jumping in. Yes, Q4 has a historically higher level of spending. Marketing spend, some of which is contractual has been deferred from the start of the year and is picked up in Q3, and we anticipated increase spend in Q4, but still at a significantly lower level than the annual spend last year.
We also anticipate additional expenses associated with systems being put into production associated with the migration on the Globex, and with the data center consolidation efforts and the build out of our New York, New Jersey data center. So based on the current forecast, I would expect to see depreciation and the other cost line as the biggest changes from Q3. However, we will still continue to look for additional synergies and cost reductions throughout the Q4.
In terms of next year, it's a bit early in the process. And we're in the budget development process now. But the entire organization has done a tremendous job over the years in managing our costs, and we expect to do the same next year. As I mentioned in our prepared remarks, we've already taken action to manage our expense growth in 2021. Our objective is to be diligent managing our costs, but to be flexible, should the environment change and opportunities present themselves.
Let me just add to what John said. As you race [ph] COVID, and what do you -- how much do we save for 2020 through COVID? And what do we think 2021 will look like? I think that is still to be decided, because we're only one side of that trade. We can't just be sending people all over the country or the world if other people are not receiving them. So it will all depend on jurisdictions abroad and here in the U.S. about how meetings are to be taken place. So I am anticipating our travel schedule will be light again in 2021. And I'm going to encourage more people doing things from Zoom to make sure that we can realize those cost savings.
So I can't give you an exact number and we are evaluating it now. But I do think it's important to realize that, we, we do need to be in front of some people. And there's others we don't. So we will make sure that we achieve those savings as it relates to the travel.
Sounds good, thanks, guys.
Thank you.
Thank you. Our next question comes from Jeremy Campbell with Barclays.
Hey guys, thanks for taking the question. Just wondering about that new water contract with NASDAQ. You guys have said to go live in December. Just wondering, did this new product kind of bubble up from potential users? Or are these potential future users a little different from your current user base, just kind of wondering if this could be the start of a user base expansion and/or product development around other natural resources or renewables going forward?
Sean, you want to talk a little bit about the agreement with NASDAQ kind of the water futures contract?
Sure. We were very excited; obviously, to extend the license with NASDAQ last year and the growth in NASDAQ futures have been a very big success this year. In addition to that and as a part of that contract we have access to other indices that they offer and we extended it out to the Veles [ph] Water Index.
We are excited about growing the customer base. We do believe that this will have an interest by large industrial users, so manufacturers as well as farmers. Obviously the farmers already are customers of our products. Nonetheless, we do believe that municipalities, farmers, industrial firms will be, in some cases new customers, for these -- or potential new customers for these products. So, we are excited about it in terms of the product launch itself, innovative new products. But yes, it could lead to an expansion and should lead to an expansion of our customers. I don't know if Julie Winkler would like to comment on it at all?
Yes, Sean, Julie will and I will as well. Go ahead, Julie.
I think it's a good point, I think, in addition, right to the water contract, this fits within this broader context of ESG products. And the philosophy we're working with our clients around on that is that, there's a suite of products that are completely news that Sean just talked about that are new, they're innovative, and they will help customers, and their firms meet their very aggressive, carbon goals over the longer term, while we have another set of initiatives to continue to modify, and make enhancements to our existing contracts, which may be things like certificates, or ESG wrappers.
And so we've got a pretty robust program in place doing product development around ESG. Since from the broader scope of things, ESG investment is really picking up and that's at the start of 2020, it was virtually the only class of funds that we've seen investment in flow. And so it's a major topic of conversation with our clients, primarily driven, I would say, in Europe, but increasingly in the U.S. as well as APAC.
So we've got, existing asset managers, banks, hedge funds, all showing a lot of strong interest, which is why you're starting to see those products, rollout from CME Group. The cornerstone of that is certainly the S&P 500 contract that is going to be the foundation of what we build everything around. And again, this is client driven and certainly investment driven, we do believe that will help attract new customers.
And just to add to that, Jeremy. I've been around a long time and we've -- I've heard nothing about other than, why don't you have a Water Futures contract and I think there was really not a catalyst for a Water Futures contract until some of the things that Julie referenced under the ESG program. And to manage the risk of water going forward, could be something that we've never seen before. So, we are excited by the partnership with NASDAQ to launch this contract.
We think -- like a lot of things, it's all about timing. There's a lot of great ideas out there with bad timing. We think that the timing is right on this because of some of the things that Julie referenced. When you look at the makeup of the globe today, especially the Earth, it's 80% water, most of it's undrinkable.
That is not a good equation for the environment that we're seeing today. People are going to need to manage that risk and we feel that we're the preeminent place to do it. So we're excited to work with NASDAQ and for the companies that Julie just outlined, in order to bring risk management to something that's critical to each and every one of our lives.
Perfect. Thanks, guys.
Thank you. Our next question comes from Brian Bedell with Deutsche Bank
Great, thanks. Good morning, folks. Just wanted to go back to the integration to do on the BrokerTec to Globex platform. Just on both from John, if you can remind us of the cost saves that that we would expect and the 1Q 2021 run rate versus 4Q 2020 or even 3Q 2020 from that integration. And then on the revenue side, basically a big initiative of this has been looking at potential revenue synergies. And Sean, you talked about the value curve. Any way to kind of size, you know, what potential increase in interest rate volumes you think you might be able to get over the next say a year from having this relative value capability launched?
Yes, sure. Thanks. I'll take the first part and then toss it to Sean on the revenue question. We're very pleased with the progress we're making, with the integrating of the business on the Globex and our synergy capture. As a reminder, we over achieved our run rate energy capture last year when we targeted $50 million and achieved $64 million broad track with the migration, with I'm sorry, we're on track with the achievement of our expense synergies, we are targeting $110 million run rate synergies by the end of 2020, so a $46 million increase in our run rate synergies.
And also, as we mentioned previously, we anticipate exceeding our 2020 realized synergies from an anticipated $15 million to $25 million. So, ended the year last year at $64 million, end the year this year at $110 million, so a $46 million increase in terms of what we realized in our income statement. We targeted $15 million, we're going to achieve $25 million. So real pleased with that and it's been an entire Company effort. And with that, I'll turn it over to Sean to talk about the revenue side..
Thanks very much. In terms of the revenues, I'm not going to give any specific guidance in regards to revenues. But I'm very excited about several different initiatives that we have available to us with the migration of the cash markets over to Globex as well as combining the advantages of having both the derivatives and cash markets under one roof. We are making several adjustments to the offering.
First of all, we got the new technology, greater determinism, and new trade types that will be available on that new technology, which we're very excited about. We're going to be offering new analytical tools, which will show the benefits of trading both cash markets and derivatives markets. And then we're adjusting some of the existing products in order to make them more attractive.
All in regards to creating greater efficiencies. At the same time, we're also working closely with the DTCC in order to bring to the market further down the road, increased or enhanced portfolio margining, or cross margining, between futures and cash products. I've already spoken about the new trade type, the new RV trade type that we'll be launching shortly after we migrate to Globex. So we are very excited about that.
I did mention earlier, as well we are launching next week new analytical tool that will allow participants on the EBS analytics or quantitative analytics to have synchronized cash and futures data for the foreign exchange market showing type-of-book, depth-of-book and really guiding participants as to the best liquidity pool to use in regards to executing whatever they need to execute in whatever size they need to execute, in whatever currency they need to execute.
We're very excited about that. The EBS Quant Analytics just for background has about 600 users globally, that 300 users log on each and every day. These are regional banks across the U.S. but in particular, Europe and Asia. And this for the first time will allow them to see the value quantitatively of using both sets of products in their risk management. So we're very excited about that in terms of our cross sell.
We will be you know next year launching similar analytics for the Treasury market. I'll also maybe mention two additional things that we will be doing. We're going to be lowering the minimum price increments on the three year notes in the first quarter, as you know, that had a significant positive impact on tier notes when we did it both on the cash platform as well as on the futures platform now almost two years ago.
So again, we're adjusting existing products, or initiating new trade types. We're offering new analytics and new technology. I mentioned earlier, that we are in the process of rolling out something called QDM 2.0 or Quote Driven Markets 2.0 for the EBS platform, and in particular for EBS direct. This will make it a state-of-the art direct trading platform. And we do plan next year on rolling that out as well for, for U.S. Treasuries.
So we're very excited across each of the different initiatives that we've got up using a plan, I guess, I'd say for the next three months, but also the next 12 months.
And just to be more precise on timing. The timing of the cutover on the platform integration in the fourth quarter, and then the timing of the RV curve launch in 1Q.
Yes, the RV will be available as soon as it's on the Globex platform, but we'll probably do a significant launch in Q1.
And just the timing of the cutover, is that November or December?
We are doing Europe in November and the U.S. in December.
Got it…
That's what's currently planned. Yes.
Perfect. Thank you so much for all the great color.
And Brian, I mean Julie is going to give you a little reference on the other part of the -- Julie?
Yeah, so in Q3 just to give you guys a little bit of an update. It was another quarter where we completed more than 500 cross introductions. And so that has put us over that thousand cross introduction mark for the year. FX is continues to be the franchise kind of front end center on those, but interest rates is second there. But what I wanted to talk a little bit about is how as we've been able to now convert many of those cross introductions into sales opportunities with 150 new sales opportunities in a pipeline, and also realizing some sales wins from that. And so that's when we actually see and have, proof that our clients have started to trade those new products and those services. So some few specific examples to your question as we've been able to bring a repo trading desk. So those are legacy BrokerTec clients, onto our CME direct platform. And there they are beginning to trade, are listed interest rate futures and options franchise. Another relevant example is cross selling across the number of customers that were legacy BrokerTec clients and introducing them to Silver futures.
And so these are the types of things that we can do as a combined sales organization in conjunction with the technology changes and migrations that are happening behind the scenes that we believe will be fruitful and continuing to bring new revenue into the exchange.
Okay. That’s helpful. Thank you.
Thank you. Our next question comes from Mike Carrier with Bank of America.
Hi, good morning. Thanks for taking the question. Given just the muted backdrop for the industry in energy complex with the Fed on hold and the COVID situation, just curious if you're starting to see more interest in certain categories given some hints of inflation. And then, based on past periods, what may be some of the early signs of seeing demand picking up? Thanks.
John or Derek?
Yes…
Hang on, John. Let Derek go first, and then I’m going to make a comment or two and then we’ll give it to you.
Yes, sure. Just to be clear, Mike we're looking for a kind of catalyst of demand side of the equation in some of these markets.
Yes, and most of them we’ve seen the pressure with the fed on hold, but I'm just saying you kind of see some hints of inflation and how that could potentially maybe spur more activity, whether it's on interest rates or energy, just because those are typically correlated.
Yes. So I think I'll probably pick up on two pieces there. I mean, maybe I'll start on the -- what we've seen on the metal side. I mean the gold market has been probably one of our fastest growing markets this year. If you actually look at the growth of that product that's been global, it's actually been largely driven by the growth that we've seen out of Asia as well. And that's been both a function of gold and precious metal demand, i.e., being a store of value certainly in times of uncertain inflation times going directly back to the comments that we've heard from the Fed that that's opened the door to inflation. We've seen that push build up through 2000 and that's been a global demand story for us.
If you see from the materials we put forward on the summary sheet, you'll see a range of records that were hit over the course of the quarter. In fact, in a very quiet Q3, we set a series of all-time records in precious metals led by both gold and silver. So, we've seen a significant increase in demand on that side of the equation as prices have gone up and that's been a strong participation across commercials, buy side, retail and our sell-side customers as well.
What we're really excited about is the -- resulting from that as we've seen more focus on precious metals. Just about 11 months ago we rolled out through the clearinghouse a system by which we allow customers to bring forward gold collateral or gold warrants and post those as collateral to the clearinghouse. And why that's important is because in less than 11 months, Mike, we've seen $3 billion of capital efficiencies brought forward for our clearing whereby they can use gold loans which typically fit debt assets on balance sheets of banks to be used to actually bring forward and put collateral forward to make trading available in all of our asset classes.
So, as we talk about -- one of the things we're doing in light of creating a monetizable set of assets for our customers, providing $3 billion of effective liquidity for our customers to be used across all of our asset classes. I mean, there's a really strong story there, another way in which we're focused on the client benefits in an uncertain market where we're seeing growth in different parts of the franchise. So with that, I'll turn it over to Sean -- or in fact to Terry.
Yes, hold on Sean. Mike let me just make a couple of comments about the rate business because I do think they're important. And I think a lot of us forget, because of the policies that have gone on over the last seven, eight months during this pandemic. But if you look back just a year or so ago, we had a 10-year trading over 3% on the yield.
The markets have moved dramatically during this pandemic. And I think people lose sight of how quickly things can change. I'm not saying they're going up, but I think you have to look at a few of the catalysts that are in front of us. One of the catalysts that I see in front of us and I'm not predicting markets, but I will tell you is the possibility of this when we're looking at November 3, and when we do not have a President elect come November 3, for a projected period of time. The government still needs to go through it’s processes of options and things of that of treasuries. The question will be, what will people be willing to pay for those options, not knowing what the makeup of our government could potentially look like.
So you could see some kind of lot of uncertainty around the marketplace. I'm not just reflecting on the price of equities, I'm looking at how people perceive the price of debt coming out around from around the world out of the United States, if we go into this contested election process. The 10 years trading roughly, the yield on the 10 years, roughly three quarters of a percent today. And so it's down dramatically just over 14, 16 months ago.
So I do think on the rate story, there is something here that people need to be cautious about. And I'm not predicting that is going to change dramatically. But I do think there's factors in the market that could make a swing. So those are the things that I'm looking at. And we are managing from a business perspective.
Great, thanks a lot.
So Terry, maybe I'll -- Terry, do you want me to jump in, maybe just some green shoots that I'm seeing?
Yes, go ahead real quick.
Yes. So, I think we already know, massive increase in Treasury issuance this year by the U.S. Treasury relative to the increased funding needs in the 3 trillion deficit this year, record all time, records deficit, all-time records to debt. And we're approaching all time record debt to GDP, so massive increases. In terms of the Federal Reserve, and its long term intent to increase inflation we are starting to see green shoots further out the curve. So specifically, to your question, if you look at the month of October, it is at the year-over-year growth month-to-date. The ultra 10 year is actually up 3% in terms of its average daily volume. The bond futures are up 10% in terms of their average daily volume, and the ultra-bond is up 20% in terms of its average daily volume.
So we are starting to see as we would expect further up the curve, increases in activity relative to this environment that should, over time move down the curve. Thanks.
Thanks, John.
Thanks Mike. Hopefully, that was helpful.
Thank you. Our next question comes from Chris Allen with Compass Point
Morning, guys. I wanted to revisit expenses, specifically the guidance for fourth quarter, it implies about a 40 million for the full year, I'm sorry, it implies about 40 million sequential increase in the fourth quarter. Normally, you see a bump in marketing and other below that's driven by your conference, which is not occurring. So is there any granularity around that increase? And then on the build out of data center and trading platforms, just kind of wondering, what's one time in nature? What's going to be into the run rate for next year? And how much that's going to be offset by some of the savings as you shut down some of the BrokerTec and EBS over time.
Sure, Chris, this is John. I'll jump in on that. Yes. So as I mentioned previously, what we've seen is a push out of our marketing spend from the first two quarters, and part of the third quarter into the back half of the third quarter and into the fourth quarter. And some of that marketing spend is contractual in nature. So you are correct, that they're, our customer facing events that we normally have in the fourth quarter have, have been postpones some of, but some of that, spend that we have in marketing is contractual and is, got pushed into the later half of the year.
Also, as we migrate on to Globex and as we build out our data center, we are expecting, that goes into work in process, and then when it gets turned on, and it goes into depreciation. So, where you're going to see the increase in spend relative to those. Those items are in depreciation and in our technology expense, as we have to pay maintenance on some of the third party software and on the equipment.
So that's where you're going to see the costs go up into next year. Now what comes out is going to be the synergies that we have targeted for 2021. And we've got the majority of the synergies in terms of run rate synergies, impacting next year. So we expect to end the year with run rate synergies of 110 million and we expect to end next year with $200 million in runway synergy, so our cost base would go down by that additional 90 million.
Now the amount that we would realize in 2021, we're still in the process of determining through our budgeting process. But we have a very, very indicated very strong focus on our expenses going into next year. And we'll be looking to accelerate synergy capture, where we can in 2021. So that's what you should expect, Chris?
Just a quick follow up, I mean, how much do you usually see from promotions and raises in terms of impact in the comp line?
In terms of, if you take a look at our -- if you take a look at our employees that we have now, and the amount of employees that have been notified that they will not be, that they will be leaving by the end of the year, I would expect that to be in the range of $20 million to $25 million of increased costs that we are avoiding on next year.
Thanks guys.
Okay.
Thank you. Our next question comes from Owen Lau with Oppenheimer.
Thank you. Good morning. And thank you for taking my questions. Now could you please comment a bit of your conversation with your clients about the VOLQ futures? Is any demand for other derivatives products around VOLQ in the future? And then quickly on the sales force, the client engagement has increased quite dramatically. What does it take to monetize that engagement and drive higher interest in trading volume? Thank you.
So Owen, this is Terry. Let me just comment real quickly on the VOLQ futures. That contract was just listed in partnership with NASDAQ. We are excited by that -- potential of that contract. But I think it's very early in a launch to try to predict how the success of that contract is going to be. We've all been around long time and we've seen how long certain contracts take to nurture. And again, timing is a big component of anything that you do in this business. So, it's really hard for us to draw any conclusions around the VOLQ futures.
Sean can give you a little bit more color if you want, but I know there's quite a bit of interest from clients on both sides, buy and sell side around that product and how they can use it to offset or mitigate some of the efficiencies as it relates to some of our other products in the equity space.
So that is one of the benefits that we have here with our suite of equity products today to potentially get more savings as the open interest starts to build. But until then, it's really hard to draw a conclusion on that product just yet. And the second part of your question was what?
It was about the sales force, I think your client engagement has increased by over 100%. What does it take to monetize that engagement and drive higher open interest and trading party?
Yeah, and we -- VOLQ well we answered the VOLQ question really. So let’s just talk about the sales force.
Yes, thank you for the question, Owen. We had a busy Q3, as you mentioned. Client engagement was up about 145% versus the same period last year. And so what we're seeing previous to other quarters and we've still been in this work from home environment is that, that activity is being driven by increased client calls, emails, these virtual meetings, the cross sell introductions that I talked about earlier.
What we've been quite busy on in, in Q3 is actually supporting VOLQ and a number of other new products. And so, we've executed a number of high-profile sales campaigns, the Micro E-mini options launch, the three-year treasuries, Brazilian Soybeans, as well as we've had hundreds of client calls to prepare for the successful SOFR Basis Swap auction that we had earlier this month.
So I think in terms of monetizing that, clients continue to point out to us just the attentiveness, responsiveness that the team has shown throughout this environment and a lot of these ongoing initiatives are there to deliver not just innovative new products but also efficiencies. And the other number I just point to is, this is an environment where people are capital constrained.
And so, when you look at what we've been able to deliver for our clients in terms of portfolio margining of swaps and futures, to-date already in 2020, we've saved our clients $5.4 billion on average and that's up from $4.5 billion last year. And so as we continue to deliver those efficiencies and help them manage their risk, we believe that's going to be quite helpful in helping them and us navigate this uncertainty.
That's helpful. Thank you very much.
Thank you. Our next question comes from Alex Blostein with Goldman Sachs.
Hey, everybody. Good morning. Thanks for the question. I was hoping we could talk a little bit about dynamics in the WTI markets and recently softer oil trends. And what really I'm trying to get to, I guess, how much of that is related, you think to sort of lower volatility, which is obviously outside of your control, versus maybe some of the lower production we're seeing in the U.S. So any way to kind of help us frame volumes kind of directly related to U.S. producers and bigger picture, if we if we get a blue sweep election, and that result in any sort of incremental curbs on U.S. oil production? How does that impact seeing this franchise, I understand the difficulties that are putting numbers around that, but just a framework of kind of how oil production translates to oil volumes to CME would be helpful? Thanks.
Hey Alex, this is Derek. Great question. When you look at what's going on in the oil market, effectively for the last 4.5 months what we've been looking at is the market finding a short-term equilibrium between supply and demand. In August, we saw prices drift higher kind to the $41, $42, $43 level -- the agreed OPEC cuts, you saw a decline in oil stocks in Cushing and globally actually and a weakening dollar.
Now counteracting that is the fact that we still have not come out of the demand destruction mode we've been in with COVID, whether you look at the metric of miles driven, if you look at jet fuel demand, I mean it's still down 75%. You're just not seeing the return to normal economic activity. You see no activity. We're not globally traveling. I think we're probably representative of a lot of firms out there.
So, the small upticks you've been seeing that would put pressure upwards are being offset by the demand side of the equation. So, you're effectively looking at a market that's trading in the $4 band, I'm talking about global crude. This is true with WTI, it's true with Brent, it's true with Murban in the Middle East. We're talking about roughly a $4 trading range. We got a flat forward curve and we got a $2 spread and a stable strength between WTI and Brent right now.
So, these are impacts -- I think the point of your question is, if you look at the impact of the global demand side of the equation, it is equally impacting global oil. This is not a U.S. phenomenon. We are certainly down on U.S. production. I think we are down from the peak of 13 million barrels a day down about 10.5 million, 11 million.
We haven't necessarily seen exports trailed off that much. We were trailing at around three, between 2.5 barrels and 3 million barrels a day in global exports. That has continued to be a demand source and a growth driver where we’re seeing domestic production on the WTI side, global demand for brands has slowed across the board.
So when you see that we see this as a global impact across all markets. If you look at the market share from a volumes perspective, year-to-date or even this quarter. We're seeing CME, if you look at the world of market share of CME, WTI plus Brent, we continue to maintain roughly 55% of that traded volume, we continue to maintain 45%, 46% of open interest. That's word of average for about the last two and a half, three years. So there's an equal impact across each of these businesses. So I think the core of the question is, where do we see demand return? And how would that be reflected in our volumes?
Well, one of the issues we've seen is when markets go slowly start to trade sideways. The reality is we've got a superior distribution out into the financial players of the energy market, whether it's the specific hedge funds, buy side asset managers, retail clients. So typically volume pullback, we see a little bit of underperformance on the WTI side. Now that we see as a temporary situation. So as we result in demand returning, we likely see that will be a participant in an upswing in volumes globally.
But I think one of the issues that we see in the energy market is natural gas. While it's been negative for the crude oil market, natural gas is a market where -- that's really the strength of our portfolio. If you look at this business, not only is it up, this is the high RPC business that we have, it's $1.15 RPC in futures, it's a $1.52 RPC on the options side. And actually, you look at the Henry Hub market share of this business, our volume year-to-date -- our Henry Hub futures business is up 26%. Our options business is up 56%.
And why this is important it continues to highlight the global nature of Henry Hub as a global benchmark. And that's shown by the fact that over the course of this year, our non-U.S. volume participation in Henry Hub was up 82%. 116% growth in Asia ours of our Henry Hub futures market and our European business is up 69%.
So within the energy complex as a whole, we're trading sideways and crude. We're seeing So, within the energy complex there's a whole -- we're trading sideways in crude, we're seeing significant growth in the high RPC nat-gas business and so, we're likely to see that continue. And finishing -- then I'll turn it over to Terry, from a Reg side, while you might see some unknown pressure relative to the fossil fuels business, if you look at the role that natural gas has to play as a clean energy and an alternative, we see that continuing to grow. So we think we're in a good position there, given the fact that we own 82% of that market. With that, I'll turn it over to Terry.
So, let me add a couple of things, especially when it comes to a potential blue sweep, because I find this quite interesting. On the production side, you know let's do a little quick history. Remember who lifted the ban on the oil export business. It was President Barack Obama's administration. That was just a one-off administration ago that did that, a Democratic administration who is very supportive of making sure the United States of America be an oil exporter.
So the rhetoric around politics today, which is always associated around Green, this is a great topic. And as you can see, the Democratic nominee is having a little bit of trouble with some of his past comments versus his current comments as it relates to fracking on some of the Eastern seaboard states.
So, that doesn't surprise me a bit. I think what you'll see is, I'm looking for more low hanging fruit. When I say that, taxes are low-hanging fruit. Now, I'm not saying it's going to be corporate or personal or both. But that will be low-hanging fruit that I think that a prior -- a blue sweep administration will try to address.
Trying to address production on energy as the Obama Administration just supported the first time in the history of this country to lift a ban on exporting of oil seems to be a bit of a stretch. And I'm assuming some of the Republican colleagues will remind our Democratic friends about who did this and why it's important to the sanctity and safety of the United States of America.
Now, that could change as Washington always does. So, I wouldn't put too much stock into that either. But I really believe a lot of this is political rhetoric right now. It's going to -- things are difficult to get done. We've only seen three major pieces of legislation in the last 19 years in these days [Phonetic]. So we had Sarbanes-Oxley, we had Dodd-Frank and we had the President -- ACA Act, that's it. Everything else is continuing resolutions.
So, I think this will be difficult at best. And even the oil -- lifting of the ban was done through a continuing resolution built to keep the government open. So you can see how there will be plenty of ammo for people who want to support energy production in the United States to have arguments against their Democratic colleagues.
That doesn't mean that some of the ESGs and other things that Julie referenced aren't still going to be front and center and people are going to be doing things. But in the short term, I think it'd be very difficult on destroying the production of oil here in the United States until we have a viable alternative that the rest of us can use.
You can't have 2% of the automobiles be electric and the rest of us don't have the ability to get them. So, I think it's quite fascinating with the conversation on politics, but I wouldn't bank on that for the next 12 to 24 months.
Great. Thanks very much.
Thank you.
Thank you. Our next question comes from Ken Worthington with JPMorgan.
Hi, good morning. Thank you for taking my questions. The Democrats are proposing changes to the tax code, including the doubling of the dividend tax rate for the wealthy, which according to the Federal Reserve, around about 50% of stocks and mutual funds in the U.S. Where the dividend tax to be doubled as proposed, how would that impact your thinking on the payout of nearly all your excess cash to shareholders in the form of a dividend? And does your capital management strategy make as much sense in a much higher dividend tax environment?
And then I guess related, in 2012 you brought the payment of your annual recurring dividend to the fourth quarter when there were concerns over changes to the tax code. If the tax outlook changes after elections next week, would you again consider pulling forward that payment into the fourth quarter?
So Ken, it's Terry Duffy. Obviously, your question is very speculative in nature, because no one knows. But on the potential of people trying to tax dividends, I really believe, as I said in my prior comments, I think they will look for other ways to get tax incentives. When you look at dividend paying companies, these are stocks that are traditionally held by the base of people who voted these people into office.
These are not the high flying stocks of the five or six banks stocks or others that they might be potentially thinking they're going to get a massive revenue off of. I think it will be very difficult to take a proposal on doubling a tax dividend going forward. I just don't see that. Again, it would be very surprising to do so.
That being said, our return -- capital return policy will be flexible enough to make certain that we can return capital to shareholders in the most tax efficient way that benefits the bottom line of the holders. So we've talked about share repurchase programs over the years. I'm not suggesting that we're going down that path right now because we don't even have one in place. It doesn't mean we can't. It doesn't mean we can't do a lot of other things on how we return capital.
But we will not look at returning capital at the most highest tax dividend -- on dividends possibly going out there. So -- but again, I think that is a very difficult proposal for the Democrats in order to raise those kind of taxes on dividends. I just don't see it happen because it won't affect the companies that they are trying to affect.
Great. Thank you.
Thank you.
Thank you. Our next question comes from Simon Clinch with Atlantic Equities.
Hi, guys, thanks for taking my question. I was wondering if you could just flush out with the collateral savings that like one 4 million, I think it is that you've saved your clients this year? Could you give us a sense of how your client redeploy that capital? How that might have happened historically, and how you'd expect that going forwards in terms of spreading that across, into other areas of your business?
Okay. Thank you for that, Simon. I'll ask maybe Sean, and then Julie to comment a little bit. And John also if you'd like. John you’d like to talk about that?
Sure. I think it's difficult to quantify exactly how much gets redeployed into our marketplace. But we certainly do see it as making us a much more attractive platform relative to alternatives. And one of the things actually that we're very excited about that we're starting this week is, we're starting to test portfolio margining of Eurodollar options against interest rate swaps. This is going to be a new portfolio margining opportunity, new facility that we're very excited about, in addition to the current portfolio margining between interest rate, sorry interest rate futures and in trade swaps.
So we have seen huge growth, I'd say. Enormous growth in both the amount saved as well as the number of participants taking advantage of it. And we do see when we offer new portfolio margining opportunities, that our relative growth to other platforms tends to increase. This is not the only area where we are looking at efficiencies. So we've also, for example, a little over a year ago, we introduced compression of our listed equity options business. We're very excited to say that we've run 27 compression runs, since we started it a little over a year ago. And we've reduced the number of contracts outstanding, which increases efficiencies for our customers by 8.3 million.
So we're constantly looking at creating new efficiencies for our customers, whether it's the equity business, the rates business, actually maybe mention on the foreign exchange business, one of these we've done over the last year is massively reduced the -- across the board minimum price increments, in our foreign exchange futures. We've also lowered them in the roles for foreign exchange futures. This saves participants cost in terms of when they execute the roles and when they trade our futures. We're very excited to say that recently, we saw all-time low open interest record, in our Euro USD futures. We saw an all-time record loans held by asset managers according to the CFTC [ph] in our FX futures. And we're excited to see the growth in the product and the growth in the use of products from the greater efficiency.
So those are some examples of where -- where when we provide these efficiencies, we do see growth, but the hard to exactly quantify the portfolio of margin and its impacts on revenues. I don't know. Julie, do you want to jump in?
So, on that point, I think what is really hard to do is, it's hard for us to quantify, for sure. But what we have seen historically and the multiple billions that Julie referenced earlier, actually it's a little bit north of the $5.4 billion because there's other part in the swaps market that has achieved benefits as well. We have traditionally seen them deploy a lot of that capital into managing risk into a whole breadth of asset classes that we have here at CME. And again, that's a historical perspective but it's really hard for us to quantify on a day-to-day basis of how they're deploying that capital. But that's what historically we've seen.
Great, thanks. And I was wondering if I could just follow-up with one question, just a more housekeeping one. But in terms of looking at the revenue per contracts for -- across your different segments, I think pretty much all have been ticked lower on a sequential basis. And I know there are lots of moving parts here. I was wondering if you could help me think about -- how to think about the revenue per contract going forwards, particularly for things like interest rates as they shift toward those longer-term contracts and in those areas where you've got the E-mini -- Micro E-mini futures which are sort of skewing numbers as well.
Yeah, thanks. And John -- before John does that, you want to [Indiscernible]. Okay, John, go ahead.
Yes. Thank you, Simon. Great question. So what you see in our rate per contracts really is a mix issues. The face rates don't generally go down. So it's really a mix of products, a mix of customers, a mix of venues. So there is multiple different mixes that happen. And what's great about our business is that we've got an enormous number of products, many different customer types and as markets shift and change, different products are used and different customers utilize those products. So, that's what you see generally in our rate per contract. They tend to all be mix related.
So, in terms of your two specific questions. When you look at the long end of the curve versus the short end of the curve; generally speaking, the short end of the curve or the Eurodollars tend to be about 14% lower than the average for interest rates and treasuries tend to be about the same higher than average in the interest rate quadrant, so -- or asset class.
So that's the -- so that's kind of the mix there, so a heavier -- higher RPC on the longer end, less on the shorter end. In terms of the micros, the micros have been tremendously successful across -- primarily across our equity asset class and our metals asset class.
In terms of our equities, sequentially they grew to almost 2 million contracts a day for the quarter and represented about 36% of the total equity volume in Q3 compared to about 34% in Q2. And also the RPC for micros increased from $0.125 in Q2 to $0.1302 in Q3. So in terms of equities in particular, in addition to the performance of the micros, we also saw a higher proportion of member trading activity as well as a lower proportion of [Indiscernible] trading activity which has a higher RPC. I do want to hit on something that Sean touched on before and that's the impacts that we're seeing on the NASDAQ trading. And really -- that's really helped our RPC in equities as the NASDAQ trading was up about 24% sequentially, which and they have and the NASDAQ contract has a higher blended RPC than average.
So a couple of other points on RPC as it relates to equities. As I mentioned the micros RPC increased to $13.02 in Q3 and that's up from $0.078 [ph] from Q3 last year. And if you take a look at the equities excluding the micros, that increased to $74.09 in Q3 versus $71.02 the same quarter last year. So both the micros and the mini RPCs increased compared to last year. So again, it's a mixed story.
In metals, you're also seeing something similar in terms of the RPC. Metals was our best performing asset class sequentially for CME Group. It's up 59% sequentially. A key factor when -- taking a look at the RPC, again which made modeling difficult for you analysts, and that was the increase in the micro activity. The micros, again it's been very successful in metals and are approaching 160,000 contracts a day and it was up over 110% sequentially. So micros accounted for about 19% of the total volume this quarter versus 14% in Q2 and the Micro Gold RPC for the quarter is approximately $0.32 and that's up from $0.27 in Q3 last year.
So that's a big impact relative to mix shifts in metals. But we are very pleased with our micros, been very successful. And again, to your point on the RPCs, it's really a mix story.
Thanks, John.
Thank you, Simon.
Thank you. Our final question comes from Kyle Voigt with KBW.
Hey, thanks for squeezing me in at the end here. Just a question on pricing really quick. You made a number of pricing adjustments over the past several years in the futures business. But I also think in the past, you've stated that typically these pricing adjustments come during periods of volume growth. Just given the volume headwinds you're facing this year, I'm just wondering how you're thinking about pricing for futures more broadly and whether you still see the potential for pricing increases or adjustments in certain products as we head into next year.
Kyle, it's Terry and I'II let John comment as well. Obviously, you're correct we try to make sure that we have a value-added proposition. Any time use any type of tier changes, our pricing changes associated with our business. That does not prohibit us from other parts of our business that are growing to take advantage of price increases.
That being said, we will be very mindful of the overall situation and we will -- we always take pricing into effect with many factors, whether it's fundamentals in the marketplace, not only here in the United States but globally, but we will be very steadfast as it relates to our pricing and how we feel what is appropriate going forward.
It's challenging, it always is. I'm not going to lie to you saying that pricing is easy to take advantage of. But at the same time, I've been always of the mind-set and I've said this historically that we need to bring up value. I say this to my clients we need to bring up value-added proposal when we bring in pricing changes. And I think when you look at what's going on with the BrokerTec integration and EBS to follow, these are all pricing -- these are all things that are enhancing the experience for the client. So we will cross that bridge when we get to it. And -- but we won't forgo them, but at the same time there are many factors that go into it. John, you want to comment further?
Yeah, just a couple of quick points. Terry is right, I mean we take a lot of time and put a lot of thought into our pricing plans. First, we're going through the budgeting process now and that's a time when we really take, again, another hard look at our pricing. But really what's absolutely critical is we want to have as much velocity going across the platform 24 hours a day. That increased liquidity is beneficial for us, obviously, because we earn money for it, but also that liquidity is very valuable to our customers, to Terry's point. So, at times that bid add spread, it makes our offering that much more attractive.
So we're very careful when we pull the pricing lever. We take -- we look at things on multiple dimensions to make sure that we create a really good and robust marketplace for our clients and really with the eye of not impacting and enhancing our liquidity.
Thank you very much.
Kyle, just to add on to that and I don't want to belabor it, but we're in a -- probably the seven or eight months of the strangest time in the history of our country, of our world. So to try to put up a pricing strategy that makes sense during normal times is a little bit difficult. So as we continue to get on the back side of this, we're continuing to evolve and hopefully our -- we'll see a change in the way our business goes.
Thanks, Kyle.
Thank you. That's all the time we have for today. I will now turn the call back over for closing remarks.
We thank you all very much for taking time out today to go through your questions. We appreciate it. Please stay safe and healthy, and we look forward to talking to you soon.
Thanks you ladies and gentlemen. This concludes today’s teleconference. You may now disconnect.