What Is the London International Financial Futures and Options Exchange (LIFFE)?

The London International Financial Futures and Options Exchange (LIFFE) is the former name of the largest futures and options exchange in London, England. It has been renamed the ICE Futures Europe after a series of mergers and acquisitions (M&A) left it under the ownership of the Intercontinental Exchange (ICE).

Key Takeaways

  • The London International Financial Futures and Options Exchange (LIFFE) is the former name of the largest futures and options exchange in London, England.
  • LIFFE is now called ICE Futures Europe.
  • LIFFE was established in 1982 and has undergone many ownership and technological changes since then.
  • LIFFE still publishes the most important index in oil trading: the Brent Crude index.

Understanding the London International Financial Futures and Options Exchange (LIFFE)

LIFFE was established in 1982 by Sir Brian Williamson whose motivation in creating the exchange was to capitalize on opportunities from eased currency regulations introduced by the United Kingdom. The exchange began with futures contracts and options linked to short-term interest rates. However, a series of M&A transactions over the years has resulted in a growing product list.

  • In 1993, LIFFE merged with the London Traded Options Market, resulting in equity options being added to the exchange.
  • In 1996, LIFFE merged with the London Commodity Exchange and added agricultural commodity contracts to its product list.
  • In 2002, LIFFE was acquired by Euronext.
  • In 2007, Euronext and the NYSE merged to create NYSE Euronext, with LIFFE becoming part of the NYSE Euronext businesses.
  • In 2013, the Intercontinental Exchange (ICE) purchased NYSE Euronext. LIFFE became part of the ICE businesses still operating under the umbrella of NYSE Euronext.
  • In 2014, Euronext exited the ICE relationship and began trading independently through an initial public offering (IPO). LIFFE remained with ICE NYSE and was named ICE Futures Europe.

ICE Futures Europe

The ICE Futures Europe exchange is one of many futures and options exchanges globally. Its peer subsidiaries under the ICE brand include ICE Futures U.S., ICE Futures Canada, and ICE Futures Singapore. In the U.S., comparable exchanges include the Cboe Options Exchange, Chicago Board of Trade (CBOT), Chicago Mercantile Exchange (CME), New York Mercantile Exchange (NYMEX), and the New York Board of Trade (NYBOT). 

The ICE Futures Europe exchange primarily uses electronic exchange networking for its transactions. However, it does have an open outcry trading pit with some human transaction execution as well. The exchange has an extensive list of members who pay a membership fee. Products transacting on the ICE Futures Europe exchange include agriculture futures, energy futures, interest rate futures, and options, and all types of equity derivatives.

The ICE Futures Europe exchange is registered as a recognized investment exchange in England. Its key regulators include the U.K. Financial Conduct Authority (FCA) and the Commodity Futures Trading Commission (CFTC) for U.S. linked products.

The ICE Futures Europe exchange business has a prestigious board of directors. It is also known for the management of the Brent Crude Index, which is a global benchmark administered by ICE Futures Europe. The ICE Brent Index is calculated to represent the average price of trading for Brent futures, the largest trading block of oil futures.