Come
visit our new web site: http://www.futurecom.org
FutureCom announces an application
to the Commodities Futures Trading Commission for
approval of the first electronic trading exchange for
agricultural commodities available over the Internet. In
the application, FutureCom seeks approval for a contract
market and trading in live cattle and options – the
first designated contract on the Exchange. FutureCom
developer, W.H. O’Brien, said other designated
contracts will be added in response to the needs of the
marketplace.
FutureCom is a limited partnership
and an affiliate of the Texas Beef Group, several
commonly owned grain and cattle companies with
headquarters in Amarillo, Texas. FutureCom is the
outgrowth of several years of development work in
trading, and managed agricultural databases over the
internet.
"Commodities have been trading
the same way for a hundred years and FutureCom believes
there are new and improved tools that will provide
traders with a better vehicle for completing
transactions. We will combine lower transaction costs
with enhanced transparency. Traders will know where they
are every second.", said Mr. O’Brien. FutureCom
will provide a cash settled contract that will relieve
concerns of traders for delivery expense and
uncertainties. To see the differences between FUTURECOM's
new trading system and the traditional system, click here. The new Exchange and contract will offer:
- LOWER TRANSACTION COST.
FutureCom will provide the trader with
substantially lower transaction costs that could
be as low as 25% of traditional fees and
commissions. This is a direct result of the
savings from reduced overhead associated with
matching orders electronically rather than
relying on people, paperwork, and infrastructure
to handle the orders.
- ASSURE THE INTEGRITY OF THE
TRADE. Costly errors resulting from human
miscommunications and mistakes will be eliminated
as traders enter and confirm their own trades.
Trading rules or computerized order matching
instructions established by the exchange will
assure that all orders are handled in the order
received, recorded to the nanosecond, and matched
according to price and time without regard to the
identity of the customer. Trading irregularities
and price manipulation will be difficult with
electronic trading on FutureCom.
- IMPROVE LIQUIDITY.
FutureCom, by broadening access to the Exchange
over the internet, will encourage all producers
and processors of agricultural commodities to
utilize a low cost risk transfer vehicle for
pricing their commodities. Commodity fund
managers and individual speculators will be able
to deal more effectively and efficiently in open
markets. The agricultural products that are
traded will be designed to closely mirror the
actual products as they trade in the cash
markets. FutureCom will offer the first cash
settled live cattle contract.
- TRANSPARENCY. FutureCom
will offer traders their complete informational
needs in order to create an effective
marketplace.
- Free quotes, graphs, and other
current trading information will be provided all
qualified traders.
- The "Best 5" bids to
buy and offers to sell will be displayed in a
specific contract month.
- Order fills will be available
immediately on market orders and within seconds
by encrypted E mail on limit orders.
- Account balances and commodity
positions updated to the last tick of the
Exchange will be easily accessible.
- Cash market information
including the index of the five primary fed
cattle markets that will be used for cash
settlement, will be provided to traders. Traders
will also be able to associate certain physical
commodities with the futures transactions. For
example the sale of five live cattle contracts
could be assigned to a group of cattle in a
feedyard.
- Trading histories of contracts
on the exchange will be available as will a
traders account history.
- IMPROVED AND SIMPLIFIED
INFORMATION SYSTEMS. Specially designed E
mail forms will communicate all exchange
information. These communications will be sent
using encrypted messaging with returned receipt
confirmations. FutureCom’s Mail Server will
embrace Internet mail standards and support all
of the key Internet protocols. An electronic
bulletin board will allow customers to view any
announcements of interest to members or traders
on the Exchange. A Trader Forum will provide a
user group where traders can post messages
expressing opinions about the Exchange and the
markets. The tasks to be managed by E mail will
include order fills, maintenance margin calls,
closed out position reports with profit or loss,
statements and other relevant information.
- AUDIT TRAIL. Traders
and regulators will be provided with instant
digital records of each trade or a range of
trades. Clearing transactions will be compiled
digitally and back up records of all transactions
retained by the exchange and made available to
the CFTC on short notice. Each session initiated
by a trader will be available for review.
FutureCom will be located in
Amarillo, Texas in the heart of the nation’s
breadbasket. An experienced technical staff will oversee
the administration of the clustered servers that will
handle and match the orders placed on the Exchange.
FutureCom will use a strict price/time priority order
matching algorithm based upon instructions set forth in
simple order processing forms submitted to the Exchange
by traders.
Access to FutureCom will be
provided to any Member or qualified trader. A trader will
need only a PC, modem, and internet access. Traders will
connect to secure servers requiring user ID and
passwords. Orders will be entered by traders using simple
forms on web browsers that will set the order
specifications and confirm the order before execution.
Margins required for a trade must be on deposit with the
Exchange prior to the execution of a trade.
Members will sign account and
clearing house agreements with the Exchange and
compliance will be monitored as trading occurs. Any
account failing to maintain the necessary margin
requirements will be liquidated after proper notice and
time to cure.
FutureCom’s electronic
exchange and designated contract offers the trader an
opportunity to benefit from an improved trading product
delivered at a greatly reduced transaction cost. Parties
interested in obtaining more information on FutureCom may
contact:
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