Intercontinental Exchange (or “ICE”) owns and operates 12 regulated financial exchanges and 6 clearing houses globally. The founder and current CEO, Jeff Sprecher, saw an opportunity to trade energy digitally and acquired a failing start-up to do so in 1997. After shoring up the technology to trade energy, ICE officially launched in 2000 with the backing of large financial and energy institutions. The company quickly thereafter expanded to offering energy derivatives, data services and clearing by acquiring more exchange assets.
Good post. I can attest as someone who has traded and cleared on ICE, they have some captive customers who cannot trade or clear at other venues, and are very good at squeezing a lot of extra revenue out of said customers.
Good high level analysis. Do you have any thoughts on how their mortgage biz and fixed income biz will evolve and compete? I have seen they acquired bond trading platforms and serve mainly muni's. Why would buyside transact on their properties instead of MKTX & TW for muni's? Seems like their main proposition is the bundling of fixed income services. Further on the ETF side of things, whilst they have been signing up AP's how come they are facilitating so little volume? MKTX & TW already offer Portfolio Trading.
This was very helpful. Thank you!
We also think ICE is a high quality company and we’ve written two short write-ups on it.
https://specialsituationinvesting.substack.com/archive
and
https://specialsituationinvesting.substack.com/archive
Can you do CBOE next?
Good post. I can attest as someone who has traded and cleared on ICE, they have some captive customers who cannot trade or clear at other venues, and are very good at squeezing a lot of extra revenue out of said customers.
Good high level analysis. Do you have any thoughts on how their mortgage biz and fixed income biz will evolve and compete? I have seen they acquired bond trading platforms and serve mainly muni's. Why would buyside transact on their properties instead of MKTX & TW for muni's? Seems like their main proposition is the bundling of fixed income services. Further on the ETF side of things, whilst they have been signing up AP's how come they are facilitating so little volume? MKTX & TW already offer Portfolio Trading.