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Strategies & Market Trends : The Final Frontier - Online Remote Trading

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To: TFF who started this subject	4/29/2004 4:47:16 PM
From: TFF	Read Replies (1) of 12617

Winnipeg exchange to go electronic By Jeremy Grant in Chicago Published: April 28 2004 18:15 \| Last Updated: April 28 2004 18:15 The Winnipeg Commodity Exchange (WCE) said on Wednesday that it planned to abandon "open outcry" trading and switch to an electronic trading platform currently used by the Chicago Board of Trade by the fourth quarter. The exchange would be the first the first open outcry commodity exchange in North America to become fully electronic, if the decision is approved at a shareholder vote next month. The development is a sign that electronic trading is making inroads into agricultural futures, which are still mostly traded face-to-face at the exchanges that offer them. However it is also understood to be part of a broader plan that could see the establishment of an electronic trading link between the CBOT, Winnipeg, the Kansas City Board of Trade (KCBT) and the Minneapolis Grain Exchange. Asked why the 100-year old WCE had decided to make the switch now, Mike Gagné, exchange spokesman, said: "The industry is changing rapidly and we were really looking at whether we continued to invest in upgrading open outcry when things are changing this fast. We decided to go electronic." The WCE, which mostly trades canola and barley futures, said it had signed a memorandum of understanding with the CBOT to use its Liffe-Connect electronic trading system. The Chicago exchange in January started leasing the system from Euronext-Liffe of Europe. Sheila Summers, KCBT spokeswoman, said her exchange was also looking for an electronic trading system but that it would be used for trading the exchange's small volume of stock index products. She said: "We are still evaluating which system would be best for us." Any general shift towards electronic trading of commodity futures - such as soyabeans, wheat and corn - may not proceed quickly as there is resistance among some traders to moving away from pit-based trading. That is because such traders view electronic trading as a threat to their personal trading franchise and have significant influence over exchanges through their memberships of them. The WCE demutualised in 2001 but most of its shareholders are former member-traders. Mr Gagné said: "We will work with the floor population and help them make the transition." ends

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