Gerald Putnam, who seized on Wall Street rule changes more than a decade ago to turn a start-up trading network into a $3 billion public company, is once again angling to profit from a massive market overhaul.
"I do believe there is a very similar opportunity," Putnam told Reuters in his first interview since becoming chief executive last month at Chicago-based TruMarx Data Partners, which operates an energy swaps trading platform.
Putnam, 52, who is also one of TruMarx's biggest investors, thinks the start-up will benefit from new US rules that will force much of the vast over-the-counter derivatives market onto transparent trading venues.
But he said proposed rules for swaps trading venues, aimed at safeguarding the financial system against future crises, could stifle markets. Several dealers and traders sounded the same warning in comments earlier this week on the Commodity Futures Trading Commission's proposed rules for so-called swap execution facilities, one of the most hotly contested areas of the Dodd-Frank financial reform law.
The Securities and Exchange Commission has also proposed rules for SEFs that allow for more flexibility. Putnam co-founded Archipelago Holdings Inc in 1997, just as the SEC was rewriting rules that sparked competition among trading venues.