Trading at the NYMEX

Discussion in 'Professional Trading' started by Quilt_top, Sep 22, 2006.

  1. Hi there, I was wondering if some of you could give me some insight to the NYMEX. I was interested in possibly visiting the exchange, maybe trading the energies makets there.

    I've been to their website, checked out the contract specifics, ect. I was wondering if some of you, who actually trade through the exchange would be willing to tell me what to expect. Is the crude oil and nat. gas contract still mainly traded on the floor open outcry? How much electronic volume is being done compared to the pit?

    I have a background in spreading some of the agricultural market at cbot. I imagine their are certain similarities between that and the energies markets.

    any help would be appreciated much.

    btw, I couldn't find the seat lease prices on the web site. anyone know where to find them?
  2. spread


    The screen is doing significant volume, but the floor hasn't been getting noticably less paper IMO. Front month paper will certainly gradually move to the screen, but it'll take time. Back months feel like they'll stay in the ring for quite some time. I'd guess that spot CL screen does perhaps 10-20% of spot CL ring. NG is less. Leases are here:
  3. let me tell you about the NYMEX......i know i have to be careful with what i say here but if you`re not in the "club" you`re going to be treated as an outsider.......ignoring your bids/offers like you don`t exist.......could`nt believe what i saw but their"club" does`nt take kindly to anyone that is`nt in the loop.
    trust`re better off behind the screen & alot safer too.
  4. spread


    Spooz, which products did you trade?
  5. NYMEX seat lease is around $20,000 per month.
  6. i have a few friends whom work at NYMEX......1 is an independant floor trader & the other heads a paper desk in the softs....OJ,coffee, january `05 i went down there & thought about leasing a seat as a i took the ferry over with them a couple times a month to see first hand what they were warning me about & saw it first can try & hit bids or take offers while in their face with spit flying as you scream at them & their looking for their pisano on the other side of the pit as if you were invisible...........i could go into a ton of incidents but i think i`m going to stop right here as some things are better left unsaid..................the screen is where it`s at.....the best & most level playing field you`re ever going to well as the best way to take these guys at there own game because most locals on the floor are going to get crushed by the screen masters once they close down the open out cry of the pit.
  7. spread


    Like I said, much of the front month paper will go to the screen, which will stop most of the stealing. The ring will continue to be the most efficient place for serious size and back months, and that's not changing anytime soon.
  8. hi quilt top ... is your background trading in the chicago ags

    upstairs or downstairs ?

    you should have enough contacts or knowledge if you have ever traded downstairs "open outcry" in chicago to answer your own
    questions or some contacts who can advice you

    if not or if you are still some how well capitalized and determined to trade NYMEX the old way "open outcry"

    I suggest you contact one or two of the largest
    clearing firms ... perhaps they will encourage or discourage
    your dream

    ps nyc has to be more expensive a city to live in than chicago

    good luck to you
  9. Iceman14


    Have heard this as well from a friend who clerks for an independent local in the heating pit...the local had been there for three years before the brokers started to warm up to him and were willing to trade the good orders with him.

    But to be fair, a lot of pits are this way...some more so than others. The bond options pits at the CBOT are kind of like that, but not bad. If you're smart and fast with making your markets, and you make good ones, you can get in on some good orders, and there are quite a few young(er) traders in there who do size.

    I hear the AG side at the BOT is horrible though...probably like the NYMEX. When I clerked there (financial, not on the ag side), I used to go on smoking breaks with a young soybean trader who couldn't get in on anything because brokers wouldn't trade with him. He told me once, "Five grand a month just to cover your nuts and these fuckers won't even look at me." You have to lease full seat in grains for some reason, hence the 5k.

    But I agree with spooz, the future is definitely the screen (in all products) and a lot of the older gen. pit cowboys everywhere are going to have a hard time adjusting to the new order. I thought about going out to the NYMEX myself, but decided against it, because I know I'd be taking a step backwards....which is why I left the CBOT floor. I know it would've been a great way to learn the market, but I figure if I can learn this stuff on the screen, I'll be better off in the long run. Even my buddy's boss is telling him (my friend) to start learning the screen and telling him to take classes/seminars abotu electronic trading for when vol. does switch largely over.
  10. minmike


    From what I heard it is difficult to actually go through membership. They hold you up for minimum 3-6 months just to get through the door. I can't imagine how bad the pits would be. The screen is still pretty difficult. In the pits they are 10 cents wide while the screen is only 2 cents wide. Tough
    #10     Sep 26, 2006