After a long history of futures and options open outcry trading, the Minneapolis Grain Exchange is closing its trading pits effective December 19, 2008. The decision to make the transition to exclusively electronic trading was unanimously approved by the MGEX Board of Directors and is pending MGEX ownership approval.
According to a MGEX release, the decision comes after an exhaustive study done by MGEX Management at the request of the Board of Directors. “Over the past 12 months there has been a dramatic trend away from open outcry and towards electronic trading witnessed by all U.S. exchanges, including MGEX,” said MGEX CEO Mark Bagan. He agreed that the transition was “inevitable” during a press conference with reporters today.
“Our customers who use the exchange for risk management purposes will still have the ability to still execute those trades,” Bagan said. “This was not a financial decision, as much as it was how do we grow our marketplace here in Minneapolis.”
MGEX Management will work closely with all members of the trading floor community to ensure an effective transition for all affected parties. The Exchange will implement a fee waiver program for floor traders who trade for their own account. In addition, a liquidity provider program and market maker program are being introduced. These initiatives are designed to help facilitate the change in venues and build market participation.
Listen to a press conference this afternoon with Mark Bagan, President & CEO, MGEX.
mgex-10-24-08.mp3
You can also download the audio with this link:
Mark Bagan press conference (mp3)


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