You now have: 5+5 DOM, block trading, reduced tick..make them know your complain!!

Discussion in 'Financial Futures' started by Bernard111, Jan 29, 2008.

  1. Please contact the CMEGroup Interest Rate Products and Services team with your opinions about their great initiatives and genius' ideas...


    Peter Barker 312-930-8554 peter.barker@cmegroup.com

    Elizabeth Flores 312.338.2801 elizabeth.flores@cmegroup.com

    Jeff Kilinski 312-648-3817 jeff.kilinski@cmegroup.com

    Jonathan Kronstein 312-930-3472 jonathan.kronstein@cmegroup.com

    David Reif 312-648-3839 david.reif@cmegroup.com

    Robin Ross 312.559.4989 robin.ross@cmegroup.com

    Suzanne Spain 312-338-2651 suzanne.spain@cmegroup.com

    -------

    Also contact:

    - the Futures Industry Association (FIA) that usually has been against monopolies:

    http://www.futuresindustry.org/contact-fia.asp

    - CFTC that must approve the reduced tick cut on 5Y and 30Y futures:
    http://www.cftc.gov/contactus/index.htm
    --------


    As a summary of the situation as of today:

    - you have less market depth (5+5 v.s 10+10); you could imagine what you will see on the book after the news releases; I can't say that this would help the cash mkt, too;

    - there is no access to extended/full DOM such as with CQG or other platforms;

    - they are going to introduce block trading to hide large transactions better even if CBOT always has been against it since it prevents a fully, trasparent price discovery;

    - it will be easier to increase exchange fees (they already increased them after the CME/CBOT announcement), especcialy for non-members obviously;

    - they will cut , in little more than a month, the tick size on 5Y and 30Y to help cash --they said--but the story is another (read: algos, bots and more exchange revenues on larger volume);

    - they probably will introduce more pro-rate algorithms on Interest Rates instruments to facilitate large trades and kill small traders (no more a pure FIFO);

    - is this enough ?

    Oh yeah, there is - maybe - an improvement:
    - faster, reliable platform until i will freeze and you will not be able to hedge your position with another instruments on another exchange, making happy only those on the pit.


    - Bernard
     
  2. "- they probably will introduce more pro-rate algorithms on Interest Rates instruments to facilitate large trades and kill small traders (no more a pure FIFO);"

    If it makes you feel any better, I talked to someone a week ago about the reduced tick size and I also mentioned about future algorithm changes that may be in the works and he told me that there were no plans to change those.
    But I'm sure there were no plans on the tick reduction until that new exhange news release.:mad:

    Also 6 weeks is almost no lead time when you have customization that requires software rewrites. They know this and I must conclude that the new exchange is the only reason for the tick reduction.

    I also mentioned to one of those names that although we now have a more reliable and faster system, I feel like we went backwards with the DOM and block trading.:mad:
     
  3. Exactly! I received the same info but from CBOT, but now the cards are on CME fully and the same advisory files already report that the machine engine/algo could be alterated after the migration.
    :mad:
     
  4. CONR

    CONR

    - they are going to introduce block trading to hide large transactions better even if CBOT always has been against it since it prevents a fully, trasparent price discovery;


    Will this be on all their products across the board?
     
  5. Bernard

    The folks you list could not give a damn less about our opinions.

    They have one idea in mind and that is to facilitate the big business that institutions can bring to them IF they will just provide a little advantage.

    That is just what has happened.

    The handwriting is on the wall for the small bond trader...They might as well find a new market, sooner rather than later...

    I personally wouldn't be transacting in that market on a short term basis. On a professional basis, unless you fill paper you arent going to see the real order flow again, certainly not on the screen.

    Its really too bad...

    Steve
     
  6. Guys,

    What do you think are the chances of similar happening on equity indexes?

    Regards,
    redduke
     

  7. very high.
     
  8. Dogfish

    Dogfish

  9. I haven't seen a block trade yet in the treasuries, anyone else ?
     
  10. Sooner or later, may be not exactly copy but they will find some advantage for real
    big boyzzzzzz.

    Problem is that the small(er) traders are learning and improving - and they are no such canon food like earlier.
     
    #10     Jan 30, 2008