U.S. Futures Exchange

From MarketsWiki
Revision as of 14:19, 29 December 2008 by JohnJLothian (talk | contribs)
Jump to navigation Jump to search
US Futures Exchange
Usfe logo.gif
Founded 2004, relaunched 2007
Headquarters 141 W Jackson Blvd, Suite 1460 Chicago, IL 60604
Key People John Spiegel CEO; Danijel Medic, head of technology;
Products Foreign exchange, equity indexes and renewable energy futures
Website www.usfe.com

US Futures Exchange is a U.S. registered futures exchange that offers electronic trading of derivatives that will discontinue operations on Dec. 31, 2008. The exchange, which was relaunched in April 2007 focused on retail and institutional products generally unavailable on other exchanges.

The Chicago-based USFE was rebranded under new ownership following the October 2006 acquisition of a majority stake by Man Group and its MF Global brokerage unit from Eurex, which retains a minority holding after its legacy organization, Eurex US, failed to gain market traction following its launch in 2004. MF Global announced on Dec. 17, 2008 it would exit USFE by the end of 2008 if it could not find a buyer for its stake.[1]

Satish Nandapurkar, CEO since its inception, left the post in January 2008, and was replaced on an interim basis by John Goldsberry, with John Spiegel later named as CEO.

Business Overview[edit]

U.S. Futures Exchange (USFE) concentrated on developing products to attract the retail market with mini-sized equity foreign equity index products and currency products.

USFE tried to use a low-cost structure to provide a “turnkey” platform for the listing of products developed in partnership with third parties.[2]

Clearing was provided by The Clearing Corporation[3], its platform is operated by Deutsche Börse Systems and regulation is by the National Futures Association.

The USFE had a page on MySpace, the social networking platform, though this has since been pulled.[4]

Shareholders[edit]

The spin-off of MF Global has made it the largest single shareholder in the USFE, with a 49.9 percent stake, with Man Group’s holding reduced to 17 percent. Both companies committed to a proportionate reduction in their holdings to bring in other partners, but difficulties at MF Global complicated those palns. Eurex had a 27 percent stake, with management and other investors holding 6.1 percent.[5]

Product Development[edit]

The new USFE launched its first product on Apr. 20, 2007, a binary future based on the outcome of the takeover battle for the Chicago Board of Trade between the Chicago Mercantile Exchange and the IntercontinentalExchange.[6]

USFE's push into the retail market saw its first foreign exchange contracts listed on Sept. 21, 2007. The FX Spot Equivalent Futures traded on a 23-hour basis, with six initial currency pairs including the U.S. dollar against the euro, yen, sterling, Swiss franc, Canadian dollar and the Australian dollar.

USFE announced on Nov. 12, 2007, that it would exclusively license the Bombay Stock Exchange’s (BSE) benchmark SENSEX Index. US dollar-denominated futures trading began on Apr. 4, 2008. USFE’s SENSEX contract allows eligible US investors to participate in India’s equity markets without requiring American Depository Receipt (ADR) authorization. The SENSEX Index is composed of 30 major Indian stocks and is regarded as the country’s premier stock market index.

The exchange launched a dollar-denominated mini-Dax contract licensed from Deutsche Borse on Oct. 1, 2008, tracking the benchmark Dax 30 and using a maker-taker pricing model.[7]

References[edit]

External Links[edit]