Electronic Trading: A Hue And Cry In The Pits
Commodities traders fear that an electronic system will wipe them off the floor
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At the Chicago Board of Trade these days, there's a palpable sense of fear and loathing in the huge bond pit. It's not because business at the world's largest futures exchange is bad. Indeed, the financial crisis in Asia has the thousands of shouting, hand-waving traders executing record numbers of transactions this year.
The fear is of the future. On Sept. 8, Cantor Fitzgerald, the world's largest bond broker--and a member of the CBOT--plans to begin electronic trading in futures contracts on U.S. Treasury bonds and notes. The contracts represent about 50% of the CBOT's total trading volume. "We're going to offer the same service for about 75% less," says Howard Lutnick, Cantor's CEO.