Eurex vows to launch US exchange
By Jeremy Grant in Chicago
Published: January 10 2003 0:29 | Last Updated: January 10 2003 0:29
Eurex, the German-Swiss derivatives exchange, on Thursday night said it would launch a derivatives exchange in the US in an immediate response to rejection by the Chicago Board of Trade of Eurex as the sole provider of a new electronic trading platform.
The development marks the opening of hostilities between Europe's largest derivatives exchange and its rivals in the US and the start of Eurex's ambitious moves to gain a foothold in the world's largest derivatives market.
It is also a victory for Euronext-Liffe, the London-based derivatives exchange, over its continental European rival. It has been battling for months to persuade the Chicago Board of Trade to switch to using its Liffe-Connect electronic trading system from an existing arrangement under which it leases a Eurex system known as a/c/e/.
The CBOT decided at a board meeting to choose Liffe-Connect and not to continue leasing a/c/e after January 2002, when the current arrangement expires.
The decision to reject Eurex will come as a surprise because most observers had thought that the Chicago exchange would stick with the a/c/e system. Rejection of the Eurex system turns Eurex into a significant threat because it will now be allowed to compete head-on for the first time with the CBOT's core US dollar interest rate futures products.
"We're going to launch our US exchange and expand our existing product base to include product on US underlying [indexes and equities]," Rudi Ferscha, Eurex chief executive, told the Financial Times.
"We've been in advanced talks with US regulators for this launch. We will continue to use the a/c/e infrastructure with the new exchange and leverage it," he said.
Eurex vows to launch US exchange
By Jeremy Grant in Chicago
Published: January 10 2003 0:29 | Last Updated: January 10 2003 0:29
Eurex, the German-Swiss derivatives exchange, on Thursday night said it would launch a derivatives exchange in the US in an immediate response to rejection by the Chicago Board of Trade of Eurex as the sole provider of a new electronic trading platform.
The development marks the opening of hostilities between Europe's largest derivatives exchange and its rivals in the US and the start of Eurex's ambitious moves to gain a foothold in the world's largest derivatives market.
It is also a victory for Euronext-Liffe, the London-based derivatives exchange, over its continental European rival. It has been battling for months to persuade the Chicago Board of Trade to switch to using its Liffe-Connect electronic trading system from an existing arrangement under which it leases a Eurex system known as a/c/e/.
The CBOT decided at a board meeting to choose Liffe-Connect and not to continue leasing a/c/e after January 2002, when the current arrangement expires.
The decision to reject Eurex will come as a surprise because most observers had thought that the Chicago exchange would stick with the a/c/e system. Rejection of the Eurex system turns Eurex into a significant threat because it will now be allowed to compete head-on for the first time with the CBOT's core US dollar interest rate futures products.
"We're going to launch our US exchange and expand our existing product base to include product on US underlying [indexes and equities]," Rudi Ferscha, Eurex chief executive, told the Financial Times.
"We've been in advanced talks with US regulators for this launch. We will continue to use the a/c/e infrastructure with the new exchange and leverage it," he said.
