I floor-traders del Nymex son a dir poco inc@zz@ti neri per l'accordo col Globex-CME, dato che taglierà di molto i loro privilegi a fronte dei quali pagano la loro seat nel pit anche a rate di 25000$ al mese, la fine dei taglieggiatori della fossa
meglio tardi che mai
Nymex Pit Traders Feel Pains Of Electronic Market, IPO
NEW YORK (Dow Jones)--As the New York Mercantile Exchange (NYM.Xx) prepares to offer global, around-the-clock electronic trading and plans an initial public offering this year, pit traders who stand to lose business in the transition are feeling lost in the shuffle.
While Nymex executives express excitement about the changes - which will bring them and the exchange inestimable riches - Nymex floor traders, most of whom own little or no pre-IPO equity, are facing the possibility of financial ruin.
The disparity between the haves and have-nots at the world's largest energy marketplace is fueling tensions. Nymex floor traders - who by and large lease seats to work at the exchange - fret that they not only will hemorrhage business after the introduction of electronic trading, but also will be overlooked at the time of any IPO. Some say they deserve better, because they generate the lion's share of Nymex's fees and revenue.
In a panic, a growing number of Nymex traders, brokers and clerks have begun to pull up stakes, taking jobs that promise better long-term security. Others, who prefer to continue potentially lucrative floor trading, where market participants shout buy and sell orders, have demanded a cut of the Nymex IPO or they will walk out.
"People feel like it's the end of the world," said Ed Silliere, who trades in the Nymex natural gas pit for New York energy brokerage firm Energy Merchant Intermarket Futures LLC. He noted that the exchange's all-electronic rival, IntercontinentalExchange Inc. (ICE), has seized business from Nymex traders in recent months, even as they pay more on leases to trade at the exchange.
Silliere said many of the pit traders he knows feel betrayed, as they pay leases of as much as $25,000 a month to drum up the bulk of the business that keeps the exchange humming.
Global trends show that market participants have increasingly shunned the old-guard trading pits in favor of executing trades electronically on computer screens, but many Nymex floor traders have resisted the shift.
Job Grab
Mindful of ICE's rising threat and looking to cut a strong profile ahead of the IPO, Nymex signed an agreement last month to offer its marquee energy futures contracts on Globex, the Chicago Mercantile Exchange's (CME) global electronic-trading platform, starting June 12. Globex, the busiest futures-trading platform in the world, reaches dozens of countries and territories 23-and-a-half hours a day.
The modernization of the bustling, if sheltered, New York energy market will help Nymex catch up with the growth of other markets, like ICE, which already have made the transition. But floor traders fear the move will make them bit players in a market where they were once the stars.
The story - which has been played out many times before at exchanges such as the CME and the New York Stock Exchange (NYX) - isn't a new one, and it often ends badly for market participants whose rough-and-tumble jobs don't transfer easily to office settings.
That doesn't mean some traders won't weather the storm, though. Craig Jefferies, owner of CKB Energy, a private New York recruitment firm for energy market participants, said business is booming, as an exodus of traders and brokers from the Nymex pits vie for jobs at banks and hedge funds.
"Everyone knows who the good traders are, and a few of them have gotten signing bonuses on one-year deals of $1.6 million to $1.7 million," Jefferies said, declining to give names. The typical salary is $175,000 to $250,000 a year, but varies greatly depending on a trader's experience. With the energy markets enjoying a full-scale renaissance, Jefferies expects few Nymex traders will look to retire now, but many won't ever take to the screen.
"These guys are mostly going to upstairs shops to trade the exotics," he said, referring to the complex spread and options transactions that are commonplace in the Nymex trading pits but still can't be accomplished easily in electronic markets.
IPO Tensions
Perhaps the most difficult pill to swallow for a number of Nymex traders is the potential for an IPO that directly benefits from the business they bring to the exchange daily, but leaves them out on the winnings.
While Nymex has yet to formally announce plans for an IPO, the exchange agreed to lay the groundwork for a float when it sold a 10% equity stake in March for $160 million to private-equity firm General Atlantic LLC. Under terms of the deal, a quick IPO would earn Nymex seat holders, who own the exchange, an extra $10 million.
Speaking privately, people close to Nymex said some long-time leasees had asked seat holders to give them a slice of their equity as an acknowledgment of their contribution to the exchange. So far, no seat holder has been known to have done that, they said.
"Look, 15 to 20 years ago, when we were all trading on the floor, some of us bought a seat instead of getting our families a house," said one Nymex seat holder, speaking on condition of anonymity. "Why should we share our equity with them?"
Others said leasees don't expect handouts, but would like a chance to buy in on the ground floor of any IPO. That would be extremely unusual for an exchange to offer, said Harrell Smith, manager of securities and investments at Celent, a New York financial consulting firm.
"If they do that it would be a nice gesture, but I certainly don't think they're obligated to," he said.
Source: Dow Jones Newswire
