5 years ago... Electronic trading helps Eurex overtake Liffe

07.08.98 Eurex - the German-Swiss derivatives exchange - claims moving to electronic trading was a major factor in becoming Europe's largest market.

It overtook London-based rival Liffe this week, and is now only second in the world behind the Chicago Board of Trade (Cbot).

Formed by the merger of Frankfurt's thriving Deutsche Termin Borse and Soffex of Switzerland, Eurex used its electronic trading system to do more business than Liffe.

At the start of the month, Eurex's German government bond future, the bund, became the most heavily traded futures contract in the world. This is in stark contrast to the situation at Liffe, which announced this week that it traded 28 per cent fewer contracts this July than during the same month last year.

Liffe is introducing an electronic trading platform which will run side-by-side with the open outcry, pit trading system. However, the new system won't be completed until the second quarter of next year, allowing Eurex to continue poaching Liffe contracts.

07.08.98 This story has had plenty of subsequent twists and turns over the past five years but there is a context that comes back again and again: the ability to evolve and move on. There is an old-style futures market close to silicon.com's offices in London, and it looks like an anachronism.

What we now know is the next Nick Leeson is likely to be found sitting at a networked terminal rather than shouting and gesticulating on a high-octane trading floor.