CME To Challenge NYSE Venue In Treasurys Trade Service
February 28 2011 - 10:59AM
Dow Jones News
CME Group Inc. (CME) announced Monday a new service for
fixed-income traders, responding to an anticipated competitive
threat from NYSE Euronext (NYX).
CME's new service will let investors pool collateral posted
against futures trading with collateral set aside for transactions
in cash Treasury instruments, mirroring a separate offering
developed by the parent of the Big Board.
That venture, called New York Portfolio Clearing and backed by
the Depository Trust & Clearing Corp., has been seen as the
most significant attack yet on CME's core business of trading
futures tied to Treasurys and key inter-bank lending rates.
NYSE Euronext anticipates its own service, and related
interest-rate futures contracts, launching in the coming month.
CME officials estimated that its new function, called the
Financial Instruments Clearing Membership, will carry collateral
offsets of up to 65% for qualifying firms. Several firms, including
Breakwater Trading and Endeavor Trading, are in the process of
signing on to the new service, according to CME.
-By Jacob Bunge, Dow Jones Newswires; 312 750 4117;
jacob.bunge@dowjones.com
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