Eurex officials flew into London last week in a bid to calm rising anger amongst traders claiming the Schatz market is being manipulated by a speculator known as the 'flipper'. Some traders were so concerned that they told FO Week that they would drastically reduced their business on Eurex.
Discontent has been stirred up by the placing of orders large enough to move the market, which are then reversed, or flipped, when the market has moved in the flipper's favour, but before the original order is filled.
Traders say that this is not a new practice but its increasing use by one large player has made life next to impossible for smaller participants, whose own orders get caught out by the flips. They also believe it contravenes market regulations, since the flipper is not representing real orders with initial quotes.
With numerous individual...