UPDATE: CME and Thomson Reuters confirm closure of FXMarketSpace
October 10, 2008
Well-placed sources have told The weeklyFiX that the CME has decided to end its involvement in FXMarketSpace (FXMS), the 50/50 joint venture it launched with Reuters, now Thomson Reuters, in March 2007. The decision was taken at a board meeting held in Chicago yesterday. So far, the exchange has not issued any official comment.
At this stage, it is not clear what Thomson Reuters’ reaction will be or how FXMS will continue to operate without CME’s clearing and trading platform. A Reuters spokesperson declined to comment when contacted.
The platform, which its owners said would be profitable within two years, has struggled for volumes since launch. Profitability was initially said to be dependent on attracting average daily volume of $16 billion. Levels of activity have never come close to that level. And despite claims of having the, “broadest, most diverse trading community,” FXMS only attracted a very limited number of participants from the foreign exchange (FX) community.
In December, 2007, FXMS announced a new initiative, its “JumpBall” strategy to try and kick-start activity. This also failed to attract any liquidity and a short while after, FXMS decided to stop publishing its volumes, even though they were still available on Reuters.