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IPE considers electronic dealing switch

Wednesday 24 September 1997 23:02 BST
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The International Petroleum Exchange has set up a committee to examine whether it should continue with its current system of open outcry floor trading or switch to electronic dealing. It is also looking at proposals that it should stop being a member-owned exchange in favour of converting to a normal for-profit company owned by shareholders.

Richard Reinert, chairman of the IPE board of directors, said: ``There has clearly been a groundswell of opinion from prominent and active members that these two fundamental issues need to be considered before making long-term decisions about the future of the IPE."

The cost of moving to better premises and retaining open outcry has been estimated at pounds 5m. In addition, IPE is already committed to a share of the costs of rebuilding the Trade Registration System it shares with other futures exchanges such as the London International Financial Futures Exchange (Liffe).

The relative merits of open outcry trading and more modern electronic systems was thrown under the spotlight last week by an alliance between France's Matif futures market and Germany's and Switzerland's Eurex joint venture.

The combined trading group, mainly using electronic trading, is being seen as a deliberate attempt to challenge Liffe's traditional floor trading, which has so far dominated Europe's derivatives trading.

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