Nasdaq plans challenge to CME and ICE in energy derivatives

(Reuters) By John McCrank – Exchange operator Nasdaq OMX Group is considering entering the energy derivatives market in a challenge to CME Group and Intercontinental Exchange Inc, according to documents seen by Reuters. The move, currently in the consultation phase, but intended to be rolled out this year, would see Nasdaq introduce energy futures and options products based on key oil, natural gas, and U.S. power benchmarks, according to the documents. A spokesman for Nasdaq declined to comment. Nasdaq has a foothold in the commodities business through Nasdaq Commodities, a power derivatives market formerly known as Nordpool that Nasdaq acquired in 2010, which operates in the UK, Germany, and the Nordics. But CME and ICE have a duopoly on energy futures, which can have better profit margins than in matching stock trades, which Nasdaq is better known for. Nasdaq has been diversifying away from the highly competitive stock transaction business for years now, into new asset classes, as well as into businesses that provide a steadier income flow, such as market data services and technology. Nasdaq said in the documents, aimed at traders, brokers and banks, it will offer “competitive fees compared to current market price for trading and clearing … continue reading

The post Nasdaq plans challenge to CME and ICE in energy derivatives appeared first on CTRM Center.

Source: CTRM Center

Leave a reply