Searching for the missing link
In the past year there have been further attempts by derivatives exchanges to head off the shift of liquidity towards OTC markets. The most prominent example was the CBOT’s joint agreement with OTC brokers Prebon Yamane and Liberty Brokerage. The two brokers will be taking a 49% minority stake in the exchange’s existing Chicago Board Brokerage. If all goes according to plan, exchange members will be able to trade government securities and repos from screens on the floor of the exchange from late summer.
The statistics certainly support the strategic logic of the CBOT’s move.
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