NYSE Futures Market Sees Clearing Function For Customers This Year
16 Marzo 2011 - 10:47PM
Dow Jones News
The U.S. futures arm of NYSE Euronext (NYX) intends to extend a
more efficient model of trade processing to exchange customers
within the year, according to an executive leading the effort.
The Big Board parent's push into U.S. interest-rate futures
trading is based on a joint venture with the Depository Trust and
Clearing Corp. that lets clearinghouse members group futures and
cash Treasurys collateral in one place.
Investor customers of clearinghouse members will get similar
benefits later in 2011, once certain operational hurdles are
surpassed, said Tom Callahan, chief executive of the NYSE Liffe
U.S. derivatives market.
"We hear from customers all the time, capital efficiency is as
important if not more important than to a global bank," said
Callahan, speaking Wednesday at a conference held by the Futures
Industry Association.
New York Portfolio Clearing, the clearinghouse facility that
will support NYSE Liffe U.S.'s fixed-income futures roster, gained
approval from U.S. market regulators in recent weeks and initial
contracts will begin trading Monday, following a nearly two-year
development period.
The move puts NYSE Euronext up against the main business of
Chicago-based CME Group Inc. (CME), which has faced down past
threats from competitors including Cantor Futures, Brokertec and a
U.S.-based venture by German derivatives exchange operator
Eurex.
Extending the collateral management functions to exchange
customers comes as NYSE Liffe U.S. aims to broaden its product
range from an early list of futures linked to Treasurys and key
inter-bank lending rates. Options on futures contracts are likely
to come online in the third quarter of 2011, Callahan said.
The exchange will charge six cents per trade side; each trade
has both a buy and sell side. The offering is competitive, but
"nobody's ever stolen away market share on fees alone," said Walter
Lukken, a former acting chairman of the Commodity Futures Trading
Commission who is leading the clearinghouse joint venture.
An initial slate of clearinghouse members in New York Portfolio
Clearing was announced Wednesday, including banks like Barclays
Capital PLC and Morgan Stanley (MS), futures brokers like Newedge
and Rosenthal Collins Group, and electronic trading specialists
like Getco LLC and Ronin Capital. Additional banks are in the
process of signing on, according to the company.
-By Jacob Bunge, Dow Jones Newswires; 312-307-4879;
jacob.bunge@dowjones.com
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