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

The following discussion is provided as a supplement to, and should be read in conjunction with, the accompanying unaudited consolidated financial statements and notes in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 27, 2023.

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

RESULTS OF OPERATIONS

Financial Highlights

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(dollars in millions, except per share data)						2023						2022						Change						2023						2022						Change
Total revenues						$	1,360.2					$	1,237.2					10		%				$	2,801.8					$	2,583.8					8		%
Total expenses						521.6						487.5						7						1,049.5						975.0						8
Operating margin						61.7		%				60.6		%										62.5		%				62.3		%
Non-operating income (expense)						$	177.8					$	117.0					52						$	421.0					$	174.2					142
Effective tax rate						23.5		%				23.6		%										23.6		%				23.0		%
Net income						$	777.6					$	662.5					17						$	1,661.4					$	1,373.5					21
Diluted earnings per common share						2.14						1.82						18						4.56						3.78						21
Cash flows from operating activities																								1,552.8						1,416.7						10

Revenues

						Quarter Ended June 30,																		Six Months Ended June 30,
(dollars in millions)						2023						2022						Change						2023						2022						Change
Clearing and transaction fees						$	1,118.3					$	1,024.6					9		%				$	2,318.5					$	2,162.7					7		%
Market data and information services						163.1						151.7						8						328.9						303.4						8
Other						78.8						60.9						29						154.4						117.7						31
Total Revenues						$	1,360.2					$	1,237.2					10						$	2,801.8					$	2,583.8					8

Clearing and Transaction Fees

Futures and Options Contracts

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

						Quarter Ended June 30,																		Six Months Ended June 30,
						2023						2022						Change						2023						2022						Change
Total contract volume (in millions)						1,417.0						1,429.4						(1)		%				3,083.2						3,036.5						2		%
Clearing and transaction fees (in millions)						$	1,025.3					$	925.4					11						$	2,130.9					$	1,959.8					9
Average rate per contract						$	0.724					$	0.647					12						$	0.691					$	0.645					7

We estimate the following net change in clearing and transaction fees based on the change in total contract volume and the change in average rate per contract for futures and options during the second quarter and first six months of 2023 when compared with the same periods in 2022.

(in millions)						Quarter Ended						Six Months Ended
Increase (decrease) due to a change in total contract volume						$	(8.9)					$	32.3
Increases due to a change in average rate per contract						108.8						138.8
Net increases in clearing and transaction fees						$	99.9					$	171.1

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

Contract Volume

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
Average Daily Volume by Product Line:
Interest rates						11,273						10,630						6		%				12,881						11,558						11		%
Equity indexes						6,216						7,751						(20)						6,760						7,851						(14)
Foreign exchange						898						950						(5)						934						927						1
Agricultural commodities						1,752						1,308						34						1,566						1,391						13
Energy						2,104						1,932						9						2,093						2,223						(6)
Metals						612						484						27						630						538						17
Aggregate average daily volume						22,855						23,055						(1)						24,864						24,488						2
Average Daily Volume by Venue:
CME Globex						20,906						21,531						(3)						22,539						22,796						(1)
Open outcry						1,124						725						55						1,373						878						57
Privately negotiated						825						799						3						952						814						17
Aggregate average daily volume						22,855						23,055						(1)						24,864						24,488						2
Electronic Volume as a Percentage of Total Volume						91%						93		%										91		%				93		%

Market volatility within certain financial markets remained high throughout the first half of 2023. Interest rate and foreign exchange volatility were higher as a result of higher inflation levels and market uncertainty following the collapse of two U.S. regional banks as well as uncertainty surrounding the Federal Reserve's interest rate policy decision. The Federal Open Markets Committee (FOMC) has raised the federal funds rate multiple times throughout 2023 and has signaled the potential for future additional hikes. In addition, the energy markets were more volatile in the second quarter of 2023 due to a shift in global supply caused by production cuts by the Organization of the Petroleum Exporting Countries (OPEC). However, overall equity index volatility leveled off following higher volatility in early 2022 caused by tensions and geopolitical uncertainty between Russia and Ukraine. We believe these factors contributed to total volume remaining relatively flat in the second quarter of 2023 and first six months of 2023 when compared with the same periods in 2022.

Interest Rate Products

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
Eurodollar futures and options:
Futures expiring within two years						28						1,142						(98)		%				176						1,506						(88)		%
Options						27						852						(97)						82						1,171						(93)
Futures expiring beyond two years						2						467						(100)						42						639						(93)
SOFR futures and options:
Futures expiring within two years						2,403						1,388						73						2,702						1,216						122
Options						1,615						223						n.m.						2,022						131						n.m.
Futures expiring beyond two years						688						241						185						797						198						n.m.
U.S. Treasury futures and options:
10-Year						2,361						2,466						(4)						2,641						2,661						(1)
5-Year						1,728						1,586						9						1,812						1,664						9
2-Year						781						750						4						804						730						10
Treasury Bond						458						536						(15)						509						546						(7)
Federal Funds futures and options						486						300						62						544						357						52

n.m. not meaningful

In the second quarter and first six months of 2023, overall interest rate contract volumes increased when compared with the same periods in 2022. We believe these volume increases were due to higher interest rate volatility as a result of higher inflation levels and indications by the Federal Open Market Committee of possible future rate hikes. In addition, market uncertainty following the collapse of two U.S. regional banks also led to higher interest rate volatility. The increase in Secured Overnight Financing Rate contract (SOFR) volumes and the corresponding decrease in Eurodollar volumes were due to more market participants transitioning to the new reference rate and away from Eurodollar contracts, which are based on LIBOR. The publication of the LIBOR rate concluded in the second quarter of 2023.

Equity Index Products

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
E-mini S&P 500 futures and options						3,836						4,494						(15)		%				4,218						4,486						(6)		%
E-mini Nasdaq 100 futures and options						1,675						2,324						(28)						1,786						2,352						(24)
E-mini Russell 2000 futures and options						311						394						(21)						321						423						(24)

In the second quarter and first six months of 2023, equity index contract volumes decreased when compared with the same periods in 2022, which we believe was due to lower overall equity volatility. The first half of 2022 saw significant uncertainty within the equity markets as a result of higher than expected inflation, as well as rising tensions and geopolitical uncertainty with Russia and Ukraine. We believe these factors led to lower overall equity contract volumes.

Foreign Exchange Products

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
Euro						240						239						1		%				254						244						4		%
Japanese Yen						183						170						7						178						152						17
British Pound						109						120						(9)						111						119						(7)
Australian dollar						96						108						(11)						100						105						(5)

In the second quarter and first six months of 2023, overall foreign exchange volumes were relatively flat, when compared with the same periods in 2022, which we believe is due to lower overall volatility relative to prior periods.

Agricultural Commodity Products

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
Corn						564						466						20		%				488						476						2		%
Soybean						353						266						32						326						295						10
Wheat						244						167						45						215						196						10

Overall commodity contract volumes increased in the second quarter and first six months of 2023 when compared with the same periods in 2022. We believe these increases are due to higher overall market volatility as a result of weather uncertainty due to a drier than average 2023 growing season. In addition, the first half of 2022 saw lower overall volatility within the commodities markets due to risk aversion by market participants following price increases and global trade uncertainty resulting from the conflict between Russia and Ukraine. We believe these factors contributed to higher overall commodity volumes.

Energy Products

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
WTI crude oil						1,076						975						10		%				1,072						1,207						(11)		%
Natural gas						600						554						8						599						548						9
Refined products						339						319						6						333						364						(8)

Energy contract volume increased in the second quarter of 2023 when compared with the same period in 2022 due to higher overall market volatility in the second quarter of 2023. The high volatility is a result of OPEC production cuts, which impacted total overall oil supply despite an increase in global demand. In addition, market uncertainty as a result of the Russia and Ukraine conflict has led to an increase in overall natural gas volume.

In the first six months of 2023 when compared with the same period in 2022, overall energy volume decreased largely due to lower overall market volatility relative to the prior six month period. Market volatility was higher particularly in the first quarter of 2022 as a result of the Russia and Ukraine conflict, which we believe led to the overall decrease in energy contract volume.

Metal Products

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

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in thousands)						2023						2022						Change						2023						2022						Change
Gold						366						288						27		%				382						339						13		%
Copper						116						89						30						120						89						34
Silver						98						82						18						96						84						14

In the second quarter and first six months of 2023, overall metal contract volumes increased when compared with the same periods in 2022. Market uncertainty following the collapse of two U.S. regional banks and the Federal Reserve's interest rate policy decisions led to an overall increase in demand for gold and other precious metals as safe-haven investments. In addition, copper contract volumes increased largely due to an increase in demand for copper in China following the lifting of restrictions from the COVID pandemic. We believe these factors led to the overall increases in metal contract volumes.

Average Rate per Contract

The average rates per contract increased in the second quarter and first six months of 2023, when compared with the same periods in 2022. The increases in the average rate per contract were primarily due to an increase to our fee structure that went into effect on February 1, 2023.

Cash Markets Business

Total clearing and transaction fees revenues in the second quarter and first six months of 2023 include $69.9 million and $144.9 million of transaction fees attributable to the cash markets business, compared with $81.9 million and $168.6 million in the second quarter and first six months of 2022. This revenue primarily includes BrokerTec Americas LLC's fixed income volume and EBS's foreign exchange volume.

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in millions)						2023						2022						Change						2023						2022						Change
BrokerTec fixed income transaction fees						$	37.9					$	42.1					(10)		%				$	77.1					$	86.4					(11)		%
EBS foreign exchange transaction fees						32.0						39.8						(20)		%				67.8						82.2						(18)		%

The related average daily notional value for the second quarter and first six months of 2023 and 2022 were as follows:

						Quarter Ended June 30,																		Six Months Ended June 30,
(amounts in billions)						2023						2022						Change						2023						2022						Change
European Repo (in euros)						$	352.2					$	345.7					2		%				$	353.4					$	333.2					6		%
U.S. Treasury						98.9						134.1						(26)						111.3						140.8						(21)
Spot FX						54.8						65.4						(16)						59.6						66.7						(11)

Overall average daily notional values and transactions revenues for the cash markets business were lower in the second quarter and first six months of 2023 compared with the same periods in 2022. We believe the decreases in U.S. Treasury and spot FX average daily notional values were due to overall lower volatility in the first half of 2023 when compared with the same period in 2022. Volatility within the U.S. Treasury and spot FX markets was higher in the first half of 2022 as a result of the conflict between Russia and Ukraine and uncertainty surrounding the Federal Reserve's interest rate policy in early 2022. The slight increase in European Repo average daily notional values were largely due to a change in market expectations regarding the European Central Bank's interest rate policy. Transaction revenues for BrokerTec and EBS also decreased in the second quarter and first six months of 2023 when compared with the same periods in 2022 due to lower volumes of trading.

Concentration of Revenue

We bill a substantial portion of our clearing and transaction fees directly to our clearing firms. The majority of clearing and transaction fees received from clearing firms represent charges for trades executed and cleared on behalf of their customers. No one individual firm represented 10% of our clearing and transaction fees in the first six months of 2023. Should a clearing firm withdraw, we believe that the customer portion of the firm’s trading activity would likely transfer to another clearing firm of the exchange. Therefore, we do not believe we are exposed to significant risk from the ongoing loss of revenue received from or through a particular clearing firm.

Other Sources of Revenue

Market data and information services. During the second quarter and first six months of 2023, overall market data and information services revenues increased when compared with the same period in 2022, largely due to price increases for certain products.

The two largest resellers of our market data represented approximately 32% of our market data and information services revenue in the first six months of 2023. Despite this concentration, we consider exposure to significant risk of revenue loss to be minimal. In the event that one of these vendors no longer subscribes to our market data, we believe the majority of that vendor’s customers would likely subscribe to our market data through another reseller. Additionally, several of our largest

institutional customers that utilize services from our two largest resellers report usage and remit payment of their fees directly to us.

Other revenues. In the second quarter and first six months of 2023, the increases in other revenues when compared with the same period in 2022 were largely attributable to higher custody fees as well as increases in co-location and other connectivity fees.

Expenses

						Quarter Ended June 30,																		Six Months Ended June 30,
(dollars in millions)						2023						2022						Change						2023						2022						Change
Compensation and benefits						$	205.7					$	185.3					11		%				$	410.2					$	370.5					11		%
Technology						53.3						45.9						16						104.6						91.8						14
Professional fees and outside services						37.8						32.0						18						76.1						63.8						19
Amortization of purchased intangibles						57.0						57.1						—						113.8						115.5						(1)
Depreciation and amortization						32.3						33.0						(2)						64.2						66.5						(3)
Licensing and other fee agreements						78.2						83.1						(6)						162.9						164.0						(1)
Other						57.3						51.1						12						117.7						102.9						14
Total Expenses						$	521.6					$	487.5					7		%				$	1,049.5					$	975.0					8		%

Operating expenses increased by $34.1 million and $74.5 million in the second quarter and first six months of 2023 when compared with the same periods in 2022. The following table shows the estimated impacts of key factors resulting in the changes in operating expenses:

						Quarter Ended June 30, 2023												Six Months Ended June 30, 2023
						Amount of Change						Change as a Percentage of Total Expenses						Amount of Change						Change as a Percentage of Total Expenses
(dollars in millions)
Non-qualified deferred compensation						$	17.2					4		%				$	28.2					3		%
Salaries, benefits and employer taxes						8.7						2		%				16.7						2		%
Currency fluctuation						9.9						2		%				14.9						2		%
Professional fees and outside services						5.8						1		%				12.3						1		%
Technology support services						7.2						1		%				13.1						2		%
Building maintenance						(1.0)						—		%				(5.4)						(1)		%
Other expenses, net						(13.7)						(3)		%				(5.3)						(1)		%
Total increase						$	34.1					7		%				$	74.5					8		%

Increases in operating expenses in the second quarter and first six months of 2023 when compared with the same periods in 2022 were as follows:

• An increase in our non-qualified deferred compensation liability during the quarter and six months ended June 30, 2023, the impact of which does not affect net income because of an equal and offsetting change in investment income, contributed to increases in compensation and benefits expenses.

• Salaries, benefits and employer taxes were higher during the second quarter and first six months of 2023 when compared with the same periods in 2022, due to increases in headcount during the year, which were primarily attributable to additional headcount in the company's international locations.

• In the second quarter and first six months of of 2023, we recognized a net loss of $1.1 million and $1.8 million, compared with a net gain of $8.8 million and $13.1 million during the same periods in 2022, due to currency exchange rate fluctuations. Gains and losses from exchange rate fluctuations are recognized in the consolidated statements of net income when subsidiaries with a U.S. dollar functional currency hold certain monetary assets and liabilities denominated in foreign currencies.

• Professional fees and outside services expenses increased due to a greater reliance on consultants, specifically for the Google Cloud transformation project as well as an increase in legal fees related to our business activities and product

offerings. The increases in professional fees were partially offset by decreases in NEX integration fees, which have steadily declined since the second half of 2021.

• The increases in expense related to technology support services were primarily driven by higher software license fees and third party services to support the ongoing Google Cloud transformation project.

Decreases in operating expenses in the second quarter and first six months of 2023 when compared with the same period in 2022 were as follows:

• The decreases in building maintenance expense in the second quarter and first six months of 2023 were driven by declines in construction and relocation expenses related to the development of the SOFR options trading floor, which was completed in 2022.

Non-Operating Income (Expense)

						Quarter Ended June 30,																		Six Months Ended June 30,
(dollars in millions)						2023						2022						Change						2023						2022						Change
Investment income						$	1,568.2					$	286.9					n.m.						$	2,925.9					$	360.0					n.m.
Interest and other borrowing costs						(40.2)						(39.9)						1						(80.1)						(82.4)						(3)		%
Equity in net earnings of unconsolidated subsidiaries						75.1						87.3						(14)						153.3						160.6						(5)
Other non-operating income (expense)						(1,425.3)						(217.3)						n.m.						(2,578.1)						(264.0)						n.m.
Total Non-Operating						$	177.8					$	117.0					52						$	421.0					$	174.2					142

n.m. not meaningful

Investment income. Earnings from cash performance bond and guaranty fund contributions that are reinvested increased in the second quarter and first six months of 2023 when compared with the same periods in 2022, due to a higher rate of interest earned in the cash accounts at the Federal Reserve Bank of Chicago following multiple interest rate hikes in 2022 and early 2023. In the second quarter and first six months of 2023, earnings from cash performance bond and guaranty fund contributions were $1,540.1 million and $2,796.4 million, compared with $295.5 million and $369.1 million in the second quarter and first six months of 2022. We also recognized higher net realized and unrealized gains on investments in the first six months of 2023.

Equity in net earnings (losses) of unconsolidated subsidiaries. Lower income generated from our S&P/Dow Jones Indices LLC (S&P/DJI) business venture contributed to a decrease in equity in net earnings of unconsolidated subsidiaries in the second quarter and first six months of 2023 when compared with the same periods in 2022.

Other income (expense)**. We recognized higher expenses related to the distribution of interest earned on performance bond collateral reinvestments to the clearing firms in conjunction with higher interest income earned on our reinvestment during the second quarter and first six months of 2023 when compared with the same periods in 2022. This was due to a higher Federal Funds rate in 2023 compared with the same periods in 2022. In the second quarter and first six months of 2023, expenses related to the distribution of interest earned on collateral reinvestments were $1,432.8 million and $2,596.3 million, compared with $223.5 million and $271.9 million in the second quarter and first six months of 2022.

Income Tax Provision

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

						2023						2022
Quarter ended June 30						23.5		%				23.6		%
Six months ended June 30						23.6		%				23.0		%

The overall effective tax rate remained relatively consistent in the second quarter of 2023 when compared with the same period in 2022. In the first six months of 2023 when compared with the same period in 2022, the effective tax rate increased slightly because we recognized a benefit related to the settlement for various tax audits in the first quarter of 2022.

Liquidity and Capital Resources

Sources and Uses of Cash*.* Net cash provided by operating activities increased in the first six months of 2023 when compared with the same period in 2022, largely due to an increase in revenue resulting from fee increases. Net cash provided by investing activities increased during the first six months of 2023 when compared with the same period in 2022. In the second quarter of 2022, we made an additional investment in S&P/DJI of $410.0 million. Cash used in financing activities was higher during the

first six months of 2023 when compared with the same period in 2022, due to a decrease in cash performance bonds and guaranty fund contributions.

Debt Instruments*.* The following table summarizes our debt outstanding at June 30, 2023:

(in millions)			Par Value
Fixed rate notes due March 2025, stated rate of 3.00% (1)			$	750.0
Fixed rate notes due June 2028, stated rate of 3.75%			$	500.0
Fixed rate notes due March 2032, stated rate of 2.65%			$	750.0
Fixed rate notes due September 2043, stated rate of 5.30% (2)			$	750.0
Fixed rate notes due June 2048, stated rate of 4.15%			$	700.0

---

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

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

We maintain a $2.3 billion multi-currency revolving senior credit facility with various financial institutions, which matures in November 2026. The proceeds from this facility can be used for general corporate purposes, which includes providing liquidity for our clearing house in certain circumstances at CME Group's discretion and, if necessary, for maturities of commercial paper. As long as we are not in default under this facility, we have the option to increase it up to $3.3 billion with the consent of the agent and lenders providing the additional funds. This facility is voluntarily pre-payable from time to time without premium or penalty. Under this facility, we are required to remain in compliance with a consolidated net worth test, which is defined as our consolidated shareholders' equity at September 30, 2021, giving effect to share repurchases made and special dividends paid during the term of the agreements (and in no event greater than $2.0 billion in aggregate), multiplied by 0.65. We currently do not have any borrowings outstanding under this facility, but any commercial paper balance if or when outstanding can be backstopped against this facility.

We maintain a 364-day multi-currency revolving secured credit facility with a consortium of domestic and international banks to be used in certain situations by the clearing house. The facility provides for borrowings of up to $7.0 billion. We may use the proceeds to provide temporary liquidity in the unlikely event a clearing firm fails to promptly discharge an obligation to CME Clearing, in the event of a liquidity constraint or default by a depositary (custodian for our collateral), in the event of a temporary disruption with the domestic payments system that would delay payment of settlement variation between us and our clearing firms, or in other cases as provided by the CME rulebook. Clearing firm guaranty fund contributions received in the form of cash or U.S. Treasury securities as well as the performance bond assets (pursuant to the CME rulebook) can be used to collateralize the facility. At June 30, 2023, guaranty fund contributions available to collateralize the facility totaled $8.0 billion. We have the option to request an increase in the line from $7.0 billion to $10.0 billion. Our 364-day facility contains a requirement that CME remain in compliance with a consolidated tangible net worth test, defined as CME's consolidated shareholder's equity less intangible assets (as defined in the agreement), of not less than $800.0 million. We currently do not have any borrowings outstanding under this facility.

The indentures governing our fixed rate notes, our $2.3 billion multi-currency revolving senior credit facility and our 364-day multi-currency revolving secured credit facility for $7.0 billion do not contain specific covenants that restrict the ability to pay dividends. These documents, however, do contain other customary financial and operating covenants that place restrictions on the operations of the company that could indirectly affect the ability to pay dividends.

At June 30, 2023, we have excess borrowing capacity for general corporate purposes of approximately $2.3 billion under our multi-currency revolving senior credit facility.

At June 30, 2023, we were in compliance with the various covenant requirements of all our debt facilities.

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

To satisfy our performance bond obligation with Singapore Exchange Limited, we may pledge irrevocable standby letters of credit. At June 30, 2023, the letters of credit totaled $285.0 million. We also maintain a $350.0 million line of credit to meet our obligations under this agreement.

The following table summarizes our credit ratings at June 30, 2023:

						Short-Term						Long-Term
Rating Agency						Debt Rating						Debt Rating						Outlook
Standard & Poor’s Global Ratings						A1+						AA-						Stable
Moody’s Investors Service, Inc.						P1						Aa3						Stable

Given our cash flow generation, our ability to pay down debt levels and our ability to refinance existing debt facilities if necessary, we expect to maintain an investment grade rating. If our ratings are downgraded below investment grade within certain specified time periods due to a change of control, we are required to make an offer to repurchase our fixed rate notes at a price equal to 101% of the principal amount, plus accrued and unpaid interest. No report of any rating agency is incorporated by reference herein.

Liquidity and Cash Management. Cash and cash equivalents totaled $1.9 billion and $2.7 billion at June 30, 2023 and December 31, 2022, respectively. The balance retained in cash and cash equivalents is a function of anticipated or possible short-term cash needs, prevailing interest rates, our corporate investment policy and alternative investment choices. A majority of our cash and cash equivalents balance is invested in money market mutual funds that invest only in U.S. Treasury securities, U.S. government agency securities and U.S. Treasury security reverse repurchase agreements and short-term bank deposits. Our exposure to credit and liquidity risk is minimal given the nature of the investments. Cash that is not available for general corporate purposes because of regulatory requirements or other restrictions is classified as restricted cash and is included in other current assets or other assets in the consolidated balance sheets.

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

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

BrokerTec Americas LLC is required to maintain sufficient net capital under Securities Exchange Act of 1934, as amended (Exchange Act), Rule 15c3-1 (the Net Capital Rule). The Net Capital Rule focuses on liquidity and is designed to protect securities customers, counterparties, and creditors by requiring that broker-dealers have sufficient liquid resources on hand at all times to satisfy claims promptly. Rule 15c3-3, or the customer protection rule, which complements Rule 15c3-1, is designed to ensure that customer property (securities and funds) in the custody of broker-dealers is adequately safeguarded. By law, both of these rules apply to the activities of registered broker-dealers, but not to unregistered affiliates. The firm began operating as a (k)(2)(i) broker dealer in November 2017 following notification to the Financial Industry Regulatory Authority and the SEC. A company operating under the (k)(2)(i) exemption is not required to lock up customer funds as would otherwise be required under Exchange Act Rule 15c3-3.