New York Mercantile Exchange: Energy and Precious Metals Leader
The New York Mercantile Exchange (NYMEX) has earned its place as the largest physical commodity futures exchange in the world.
This global commodity market titan focuses on precious metals, the energy complex, and environmental futures contracts.
In fact, it was NYMEX that introduced energy futures back in 1978 aiming to build the capacity for risk management and price transparency in commodity markets.
In March 2008, in line with the current trend for consolidation in global commodity exchanges, NYMEX merged with CME Group to form a world-class trading platform in the above resources.
Trading on NYMEX
The exchange has introduced a proprietary clearing system called Clear Port.
This helps to ensure the various credit risks are reduced by placing dealings occurring “off exchange” through the in-house system along with mainstream futures contracts.
Commodity prices are discovered through the interchange between the professional traders on NYMEX.
Opinion can often change in the twinkling of an eye and it is the build-up of consensus here that gives a broader signal as to where futures prices are moving.
What is traded on the Exchange?
So let’s take a closer look at the commodity futures that are traded on the CME Comex trading platform as well as in some cases, through the NYMEX traditional open cry system.
- Crude Oil
- Natural Gas
- Heating Oil
Electronic Trading Platform and other services
The New York Mercantile Exchange offers a range of services to make up-to-date information available to interested parties such as traders, producers, and commercial end-users.
One such service is NYMEX Direct which gives remote users, who may be thousands of miles away in another country and time zone, access to real-time futures and options data and relevant news from other global exchanges.
In addition, they offer interactive charts with drawing tools and technical indicators.
There is also a facility that allows you to take data from the application and manage it elsewhere, for example, in Microsoft Excel.
This is a browser-based application and is designed for affordability and to be easy and direct for the trader as end-user.
And because the browser is in-built you can visit other websites without closing down the NYMEX Direct application.
You are offered a free trial before you have to decide on the full subscription service.
There is a standard version called Web, and a more sophisticated application for professional subscribers as well as a mobile option that can be used on say a Blackberry with more or less worldwide coverage.
With technology changes and a growing interest in commodities among retail investors, we are likely to see further innovations in trading platforms.
And with new products being introduced in areas such as water, plastics, and carbon, the New York Mercantile Exchange is likely to be a big player in these developments going forward.