When asked how much influence FCMs have over exchange fees, Calyon Financial's global head of projects, Steve Auerbach laughed. "I don't like paying taxes either," he said, "but I have to pay those too."
The FCM landscape has seen radical changes. Escalating exchange fees may be nothing new, but as customers have demanded wider connectivity and faster service they have become yet another cost in a long line of expenditure for the brokerages. It has started to appear that a hefty balance sheet is no longer simply a useful weapon in the battle for global expansion, but a necessity for survival.
While increased electronic trading has been good in the long term for cost reductions, many have argued that maintaining open outcry alongside electronic trading venues can put extra pressures on infrastructure. This has become a strongly debated issue in the US, where electronic trading has been slower to gain...