Altra sets the standard for Net marketplaces
Altra Energy Technologies scored a recent coup when it was ranked No. 1 on AMR Research's list of the best Net marketplaces. In particular, AMR--and other industry watchers--have marked Houston-based Altra as the most liquid of all Net markets.
A liquid market has enough buyers and sellers, and enough product flowing across its exchange, that a buyer can hit the market at any time and acquire the product it wants at a fair market price.
Think of a stock exchange. You never have to wait to purchase shares of a listed company on the Nasdaq or NYSE, and you can be sure the price you pay is a reflection of how the entire market is valuing the stock.
In Altra's world, liquidity means almost 2,000 buyers and sellers, and daily trading volumes reaching 12 billion cubic feet of natural gas, 1 million barrels of gas liquids and 1 million megawatts of power, according to AMR.
What does that mean for traders on the Altra marketplaces?
"At a minimum, a buyer or seller won't conduct business with a voice broker, the traditional avenue for business in these industries, without at least checking their [Altra] screen from a price discovery point of view," said Paul Bourke, Altra president.
Indeed, traders using the Altra network say it's become an important part of their trading routine. "It's easy to use, and I like the anonymity you get with the system that you don't get with voice brokers," said Jeff Patin, an energy trader with Koch Industries Inc.
Patin still relies on voice brokers to trade but uses the Altra exchange almost as a testing ground, putting out bids to see if anyone might bite.
Another trader from a large natural gas company, who requested anonymity, said he starts his day on the Altra exchange. "I come in, even if it's 6:30 in the morning, and log on to the system, get my day going. As more and more people log on, you can see how the market's starting to develop," he said.
"In the old days, it was strictly bang the phone, bang the phone. If there are 140 traders logged on to Altra, it's like I'm talking to 140 people without having to make 140 phone calls."
What's next for Altra? This month, the company takes a big step away from the simple trading screens of its early days, introducing an energy trading portal that brings an array of content and services to the mix. "We've taken our black-and-white screens and turned them into a more pleasing, informative environment," Bourke said.