The board of the London International Financial Futures and Options Exchange (LIFFE)today proposed a switch to electronic trading before the end of the century aspart of a wide-ranging overhaul of the business.
But the plan will include 130 job losses and a £44m cut in spending asthe exchange attempts to become more competitive against overseas rivals.
The move comes just a week after members agreed to slim down the exchange’sboard and appoint a full-time chairman.
The latest proposals from LIFFE’s board include introducing electronic tradingin the autumn of 1999 spelling the end of so-called “open cry” trading on thefloor of the exchange.
The board also proposed to make it easier for non-members to take ashareholding in the exchange which is technically a limited company owned by itsexisting 215 shareholding members.
Jack Wigglesworth, chairman of LIFFE, described the proposals as substantialchanges needed to keep the exchange competitive.
“We need a new strategy, embracing new technology, with a new focus to meetthe needs of new market users,” said Wigglesworth.
The introduction of electronic trading, with deals being made over computerscreens will also make it easier for non-members to take part in the trading offutures and options.
The LIFFE board said not all futures and options would move to the electronicsystem immediately but would migrate on a case-by-case basis with many beingtraded both on screen and on the exchange floor.
Futures and options are highly complex contracts gambling on the future pricesof equities commodities and foreign currencies.
Full details of the LIFFE board’s proposals will be put to members at the start of May and subject to a vote later that month.
EGi News 23/04/98
