CME Commercial, I don't get it

Discussion in 'Trading' started by billb2112, Feb 26, 2003.

  1. I don't trade commodities, maybe this is why I fail to see the value of those CME commercials.

    I know the CME went public recently, is this why? What is the point of raising public money for an exchange? I guess I question the NYSE commercials equally.

    Has this improved anything from a trader's standpoint since the exchange made a public offering?

    (I've also wondered why the NYSE runs ads, or Nasdaq for that matter when they used to).
  2. This is just a guess, but...

    I doubt they needed the money. Back when they were non-profits they were member controlled, you can bet that any change is all about benefiting the members, not the public. There are four issues I can think of that could be possibly affected by the change. PR, control, profits, and money raised by the offering.

    Good PR means investors are more likely to trade whatever is listed on the exchange, it also means that companies are more likely to list on that exchange. Perhaps they're hoping the public perception of the exchanges will improve. Perhaps a public company, serving the public with the hope of making a profit is something more easily understood than a member-controlled organization particularly when the members are also the middle-men. Of course, nothing has changed, but the perception might.

    That leaves profits and control. I doubt much changed when it comes to control, perhaps there were some regulatory issues that were solved by the transition from members of a non-profit to owners of a business. I have no clue.

    Profits, this may have been the main reason. Now besides screwing the other customers of their own exchange by restricting access, they can also charge high prices for everything and redistribute the profits to themselves as stock owners.

    I think that covers it, I'd love to hear other ideas.

  3. bone


    They gotta do something with all of those e-mini fees they collect... might as well make a hard charging commercial.