New York Mercantile Exchange Totally Explained

Everything about Nymex totally explained

The New York Mercantile Exchange (NYMEX) is the world's largest physical commodity futures exchange, located in New York City. Its two principal divisions are the New York Mercantile Exchange and the New York Commodities Exchange (COMEX) which were once separate but are now merged. The New York Mercantile Exchange, Inc. is now traded publicly, as its parent company, NYMEX Holdings, Inc. became listed on the New York Stock Exchange on November 17, 2006, under the ticker symbol NMX.
   The New York Mercantile Exchange handles billions of dollars worth of energy products, metals, and other commodities being bought and sold on the trading floor and the overnight electronic trading computer systems. The prices quoted for transactions on the exchange are the basis for prices that people pay for various commodities throughout the world.
   The floor of the NYMEX is regulated by the Commodity Futures Trading Commission, an independent agency of the United States government. Each individual company that trades on the exchange must send their own independent brokers. Therefore, a few employees on the floor of the exchange represent a big corporation and the exchange employees only record the transactions and have nothing to do with the actual trade. The NYMEX is one of the few exchanges in the world to maintain the open outcry system, where traders employ shouting and complex hand gestures on the physical trading floor.
   On February 26, 2003, the New York Board of Trade (NYBOT) signed a lease agreement with the NYMEX to move into its World Financial Center headquarters and trading facility after the NYBOT's original headquarters and trading floor was destroyed in the September 11, 2001 terrorist attacks on the World Trade Center.(External Link

) After the terrorist attacks, the NYMEX built a $12 million trading floor backup facility outside of New York City with 700 trader's boothes, 2,000 telephones, and a backup computer system. This backup is in case of another terrorist attack on Lower Manhattan or a natural disaster.(External Link

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History of the exchange

Commodity exchanges began in the middle of the 19th century, when businessmen began organizing market forums to make buying and selling of commodities easier. These marketplaces provided a place for buyers and sellers to set the quality, standards, and establish rules of business. By the late 1800s about 1,600 marketplaces had sprung up at ports and railroad stations. In 1872, a group of Manhattan dairy merchants got together and created the Butter and Cheese Exchange of New York. Soon, egg trade became part of the business conducted on the exchange and the name was modified to the Butter, Cheese, and Egg Exchange. In 1882, the name finally changed to the New York Mercantile Exchange when opening trade to dried fruits, canned goods, and poultry. As centralized warehouses were built into principal market centers such as New York and Chicago in the early 20th century, exchanges in smaller cities began to disappear giving more business to the exchanges such as the NYMEX in bigger cities. In 1933, the COMEX was established through the merger of four smaller exchanges; the National Metal Exchange, the Rubber Exchange of New York, the National Raw Silk Exchange, and the New York Hide Exchange. On August 3, 1994, the NYMEX and COMEX finally merged under the NYMEX. Now, the NYMEX operates in a state of the art trading facility and office building with two trading floors in the World Financial Center in downtown Manhattan. On March 17, 2008, NYMEX accepted an offer from CME Group, the parent of the Chicago Mercantile Exchange and the Chicago Board of Trade, to purchase it for $8.9 billion in cash and CME Group Stock.(External Link

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Location

The official address of the NYMEX headquarters and trading facility is One North End Avenue, New York, NY 10282-1101. The company has additional offices in Houston, Washington D.C., Dubai, London, and Hong Kong.

Commodities traded on the exchange

Holidays and Special Dates

Date	Day	Holiday	Open Outcry	Electronic	Clearport
1 January 2007	Monday	New Years Day	Closed	Closed until 18:00	Closed until 18:00
15 January 2007	Monday	Martin Luther King Day	Closed	Open	Open
19 February 2007	Monday	President's Day	Closed	Open	Open
6 April 2007	Friday	Good Friday	Closed	Closed	Closed
28 May 2007	Monday	Memorial Day	Closed	Open	Open
4 July 2007	Wednesday	Independence Day	Closed	Open	Open
3 September 2007	Monday	Labor Day	Closed	Open	Open
22 November 2007	Thursday	Thanksgiving	Closed	Open	Open
25 December 2007	Tuesday	Christmas Holiday	Closed	Closed until 18:00	Closed until 18:00

Further Information

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