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Joe is right about TOPS having limitations. It is actually pretty amazing
though the growth that TOPS has seen over the last couple of years. Both the
CME and the CBOT though have introduced new ways to interface with their
electronic trading platforms and the trading floors. The CME's recent fee
structure was clearly aimed at producing an economic incentive for people to
move off of TOPS on to the FIX API of the CME and the Order Direct floor API
of the CBOT.
Unfortunately, there are lots of things that need to be adapted when changing
trading connections. I am in the process of deploying the E-Open Outcry from
the CBOT. This is the CBOT's leased version of the Oak Trading platform. It
does some things that TOPS or even COMET does not do. It uses the Order
Direct floor API to connect to Electronic Clerk devices on the CBOT floor.
However, when the fills come back from the EC, it goes to the CBOTCC then to
the FCM, then back to the back to the CBOTCC. The normal path with TOPS is
from TOPS to the EC, back to TOPS, to the FCM and then to the CBOTCC. This
change in route requires changes to the backoffice software of the FCM, which
can be a complicated issue.
Deployment of the FIX API for open outcry trading will probably cause similar
system changes to be necessary. Given the concentration of retail clearing in
the business, it might be easier for smaller clearing firms to pull these
changes off first. Small problems are much easier to solve than huge
problems.
I did check with a couple of CME sources about whether TOPS or FIX was
providing move volume to Globex2. While I was unable to get the exact
numbers, one source said in the last two months that the FIX API had taken
over the volume lead from TOPS for Globex2 volume. However, they also said
that this was skewed because the CME has stopped providing new access to the
TOPS ORAPI connection.
I think the CME's new Globex2 deployment rules will help with FIX deployment,
as it is cheaper and easier to add Globex2 terminals to support etrading. I
also think the marketplace will be making a big choice for FCMs as more
people embrace the streaming quotes and interactive trading of some of the
next generation trading platforms.
Regards,
John J. Lothian
Disclosure: Futures trading involves financial risk, lots of it! John J.
Lothian is the President of the Electronic Trading Division of The Price
Futures Group, Inc., an Introducing Broker.
In a message dated 1/6/01 7:33:18 AM Central Standard Time,
joeduffy@xxxxxxxxx writes:
<<
I really don't have a bone to pick defending the CME. For anyone interested
if you go to the CME website you will see they very specifically refer to
the "limitations associated with TOPS for electronic trading" and that they
are encouraging all firms to migrate "to the FIX API".
Again this refers specifically to e trading only, NOT the open outcry
markets. >>
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