Exchange wars

By Telis Demos, Fortune reporter

(Fortune Magazine) -- The world's exchanges were once clubby nonprofits. But that all changed on March 7 when the New York Stock Exchange merged with Archipelago, going public and electronic in a day.

That deal sparked a wave of consolidation -eat or get eaten. The name of the new game is volume: The more trades flowing through your electronic platform, the more revenue. Now the mega-exchanges are each trying to dominate its niche of global trading. The result will be monopolistic empires that keep adding complementary pieces. "The way I think about it," says S&P analyst Jason Willey, "it's a huge land grab."


Derivatives need to be bought and sold on the same exchange. So merging was the only way for Chicago to grow.

Chicago Mercantile Exchange 111.5 (million) trades

Chicago Board of Trade 62.4

Targets? Chicago Board of Options Exchange International Securities Exchange CBOE (going public) and ISE (public) are rumored targets for the new CME. The four would then trade over 75% of U.S. derivatives.

The Exchange That Never Sleeps

NYSE's CEO John Thain wants the first multi-time-zone exchange. In December, Paris's Euronext will vote on NYSE's offer.

New York Stock Exchange 114.1

Euronext 80.7

Targets? Tokyo Stock Exchange Tokyo is in talks with many exchanges, but it favors a NYSE

Euronext hookup, which it would join as an Asian outpost.

The Axis of Tech In SarbOx-free Europe, LSE is beating Nasdaq for tech and emerging-market startups. Buying LSE/EDX would solve that.

Nasdaq 100.3

London Stock Exchange 9.3 Owns part of EDX

EDX London 10.0 Targets?

Jasdaq Japan's Jasdaq would help Nasdaq maintain its tech edge, plus add volume to help keep up with NYSE - Euronext.

Wild Cards

Bombay Exchange India's market for blue chips like Tata and Infosys is shopping itself: NYSE, Deustche, and LSE top the list of suitors.

Deutsche Börse Owns part of Eurex Deutsche is still bidding for Euronext. Because if NYSE Euronext happens, Deutsche becomes a target.

New York Mercantile Exchange The home for U.S. oil and gas futures is going public - some say to help it fetch a better price in a merger.

Source: World Federation of Exchanges  Top of page