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Tokyo, Chicago Exchanges Talk Alliance

After the Tokyo Stock Exchange exposed its secrete strategic agreement with the New York Stock Exchange on Wednesday, the Japanese business newspaper, Nikkei reported Thursday that the world`s second largest stock exchange is expected to begin negotiating an agreement of cooperation with the commodity exchange in Chicago. The paper says the Chicago Exchange, the largest future option market in the United States, was the side to propose the cooperation.

A spokesperson for the Tokyo Stock Exchange said that the President of the Tokyo Stock Exchange, Taizo Nishimuro is currently in Chicago, but added she is uninformed regarding his exact schedule. "We started talks seven years ago with the Chicago exchange to explore what we could do together," the spokesperson said. "We`ve been holding tie-up discussions since last year." Stock Exchanges around the world are increasing cooperation recently, through alliances and mergers, in order to share the burden of investment in next generation systems, as well as, to better face the increasing competition, caused by the globalization of information and commerce.

The Chicago Mercantile Exchange was founded in 1989 as Chicago Butter and Egg Board. Originally, the exchange was a not-for-profit organization. The exchange demutualized in November 2000, and went public in December 2002. The Chicago Mercantile Exchange trades several types of financial instruments: interest rates, equities, currencies, and commodities. It also offers trading in exotic instruments such as weather and real estate derivatives. It has the largest options and futures contracts open interest (number of contracts outstanding) of any futures exchange in the world.