Bankers question Mexican derivatives exchange

Traders in Mexico City and New York are expressing doubt about the efficacy of the new Mexico derivatives exchange (MexDer), which is set to open tomorrow. Most question the need for a parallel exchange that will concentrate solely on pesodollar forwards, contracts already traded on the Chicago Mercantile Exchange. "Not everyone is so enthusiastic about [the local exchange] and thus there'll be a problem with liquidity," predicts a trader at a European bank in New York. The Chicago contracts are relatively liquid, carry less counterparty risk, and offer more options, the bankers claim.