Kansas City Board of Trade facts for kids

Kansas City Board of Trade, on West 48th Street (2008)

The Kansas City Board of Trade (KCBT) was a special marketplace in the United States. It was a place where people bought and sold agreements for future deliveries of farm products, especially a type of wheat called hard red winter wheat. This marketplace was located in Kansas City, Missouri.

The KCBT was regulated by the Commodity Futures Trading Commission. This is a government group that makes sure trading is fair and honest. On October 17, 2012, a larger company called CME Group bought the KCBT. The trading floor in Kansas City stayed open for about six months after that. Later, in June 2013, the trading activities moved to Chicago. The Kansas City trading floor then closed completely.

History of the KCBT

The Kansas City Board of Trade started in 1856. This was soon after Kansas City became an official city in 1853. At first, it acted like the city's chamber of commerce. A chamber of commerce is a group that helps local businesses.

The KCBT became an officially recognized exchange in 1876. One of the people who helped start it was Edward H. Allen.

The exchange was first located at 8th and Wyandotte Streets. Its building was designed by famous architects from Chicago.

In 1925, the KCBT moved to a new spot at 10th and Wyandotte Streets. Then, in 1966, it moved to its final home. This last location was at 48th and Main Streets, in an area called the Country Club Plaza.

How the KCBT Worked

The main things traded at the KCBT were "futures contracts" for hard red winter wheat. A futures contract is an agreement to buy or sell something at a set price on a future date. They also traded "options," which give someone the right, but not the obligation, to buy or sell.

Hard red winter wheat is very important for making bread. Because it's so nutritious, it often sold for a higher price than other types of wheat. This type of wheat is now traded on the Chicago Board of Trade.

The KCBT used to have a system called "open outcry." This is where traders stood in a pit and shouted out their offers to buy or sell. Later, trading moved to an electronic system, where people used computers.

In 1982, the KCBT was the first exchange to offer "stock index futures." These are futures contracts based on how a group of stocks is doing, like the Value Line Composite Index. Options on these futures were added in 1992. By December 12, 2004, all Value Line futures trading was done only on computers. These Value Line futures are no longer traded.

Learning About the KCBT

The KCBT used to offer tours for visitors. These tours usually happened on weekday mornings when trading was active.

Visitors would first watch a short movie. This film explained what commodities futures were and why hard red winter wheat was important. After the movie, guests went to a special viewing area. This area looked down onto the trading floor. A staff member would explain how trading worked. They would also talk about the prices shown on the big boards and why the commodities market was so important.

See also

• List of futures exchanges
• List of traded commodities
• Value Line Composite Index, traded on the futures market at the Kansas City Board of Trade