Business Online – THE New York Mercantile Exchange spied an opportunity when the Intercontinental Exchange (ICE.XX) closed its London trading floor in early 2005 and moved energy contract trading to computer terminals.<\/p>\n
Inspired by disgruntled ICE traders, famed for their colourful jackets, Nymex opened its own floor with a blitz of advertising, calling itself the \u00c3\u00a2\u00e2\u201a\u00ac\u00c5\u201cchampion of open outcry\u00c3\u00a2\u00e2\u201a\u00ac\u00c2\u009d and rolling out the red carpet for traders on opening day.<\/p>\n
But Nymex\u00c3\u00a2\u00e2\u201a\u00ac\u00e2\u201e\u00a2s bid to snatch business from ICE was undermined by a phenomenon that was driving the switch to electronic from open outcry trading: the arrival of big money managers to the energy markets.<\/p>\n
The hedge funds that have crowded into the energy markets in recent years don\u00c3\u00a2\u00e2\u201a\u00ac\u00e2\u201e\u00a2t need coloured jackets or open pits. They need robust software programs that can transfer huge amounts of money instantly.<\/p>\n
Caught off guard by the shift in the market, Nymex closed the London pit eight months later, and is now itself offering computer trading to compete with its rival.<\/p>\n
\u00c3\u00a2\u00e2\u201a\u00ac\u00c5\u201cWhat the market wanted then [when ICE moved fully electronic], it doesn\u00c3\u00a2\u00e2\u201a\u00ac\u00e2\u201e\u00a2t want now,\u00c3\u00a2\u00e2\u201a\u00ac\u00c2\u009d Nymex Europe chief executive Andy Gooch said.<\/p>\n