Online Gambling or Vital Financial Tool?

I’m a member of Tradesports.com. Last fall, I had a good time trading Central Park weather futures. IE, the number of inches of snow in Central Park at the end of each month. I liked excercising my statistics skills.

Most people think of Tradesports as a sports book. But wait, there’s more. Insurance companies have a lot in common with gambling houses.

Read this Annoucement I just got from them

For immediate release

December 13, 2005

Trade Exchange Network Limited Launches Exempt Board of Trade

Trading in weather, economic numbers & credit risk planned

Dublin, IRE – Trade Exchange Network Limited, parent company of Tradesports.com & Intrade.com, has filed a notice with the US Commodity Futures Trading Commission to operate an Exempt Board of Trade – EBOT.

The company intends to offer trading in unique contracts that serve the needs of the professional trading community. “Financial institutions, insurance companies & hedge funds have asked us to help them manage risks by listing contracts not found among current exchanges. Weather, credit risk and macro economic events, to name a few, present risks to portfolios that can not be managed with the current exchange products – we intend to change that by offering unique contracts on these events”, says John Delaney, CEO.

The Commodity Futures Modernization Act allows for the creation of Exempt Boards of Trade but these markets are open only to Eligible Contract Participants – banks, insurance companies, hedge funds, regulated entities and high net worth individuals that meet certain financial requirements. “An EBOT is a natural next step in our growth, over the last four years we’ve established a solid reputation as the leading marketplace for economic and current event risk in the world. We bring not only our proven exchange technology to the table but will also provide a central counterparty [clearing house] to every trade and that should make financial institutions comfortable trading these markets”, says Delaney.

For more information on Trade Exchange Network and their Exempt Board of Trade contact Mike Knesevitch, Communications Director, 908-604-9423.

An EBOT is a board of trade that limits trading to contracts for the future delivery of a commodity (or options on such contracts or on a commodity) for which the underlying commodity has: (A) a nearly inexhaustible deliverable supply; (B) a deliverable supply that is sufficiently large, and a cash market sufficiently liquid, to render any contract traded on the commodity highly unlikely to be susceptible to the threat of manipulations; (C) or no cash market. The contracts can be entered into only between persons that qualify as eligible contract participants. The CFTC has exclusive jurisdiction over any contract or transaction traded on an EBOT, however, an EBOT may not represent to any person that the EBOT is registered with, or designated, recognized, licensed or approved by the CFTC.

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