Deutsche Börse’s Eurex will start a pilot scheme next week that introduces tiny delays to the trading of options on French and German stocks
- The London Metal Exchange is also set to receive approval for a similar initiative
- two weeks ago US regulators approved Intercontinental Exchange, the second-largest US futures operator, to apply delays on trades of two precious metals contracts
The moves are hotly debated.
- “[Futures] markets exist for the transfer of risk by increasing liquidity,” said Carl Gilmore, president of Integritas Financial Consulting in Chicago, who is a supporter of speed bumps. “If it draws people in, it makes the markets fairer. If they’re perceived to be unfair, then something needs to be done to correct that perception,” he said.
- “The goal of financial markets is not to protect or shelter the less informed,” said Brian Quintenz, a Commodity Futures Trading Commission commissioner who opposed the agency’s approval of speed bumps for ICE. “Market efficiencies are earned – they are created through research, investment, and intellectual property.”
Financial Times piece here for more, may be gated