UPDATE: CME and Thomson Reuters confirm closure of FXMarketSpace
October 10, 2008
Few players in FX are surprised that the CME has apparently decided to pull its support from FXMarketSpace – exclusively revealed by theweeklyFiX this week but which the exchange has yet to confirm – given that it has always struggled to attract activity.
At the time the joint venture was announced in May 2006, the exchange and its joint-venture partner Reuters (now Thomson Reuters) detailed the financial implications of what they termed, “the next phase in the evolution of the global FX market.”
They both agreed that they would contribute up to $45 million, “to fund the venture through to profitability. The business plan anticipates two roughly equal amounts of capital contribution, in 2006 and 2007.”
The companies added: “CME and Reuters expect their respective shares of start up losses to be $20 million to 25 million, with around $5 million of this expected in 2006. The joint venture is expected to achieve profitability during 2008.”
Looking at the CME's published results, it can be seen that FXMS cost it $13.876 million in 2006 and a further $18.973 million in 2007. Although FXMS officially stopped publishing its volume statistics earlier this year, these were still available on Reuters and they have remained paltry.