- What is NYTEX?
- How NYTEX Works
- The Nytex Telecom technology
- The NYTEX Advantage for Buyers and Sellers
What is NYTEX?
The New York Telecom Exchange (NYTEX) is the world’s first neutral telecommunications commodity exchange and is the new standard for trading international call termination.
Telecommunications is a complex product with many parameters. NYTEX has taken this complexity and transformed it into an easily traded commodity using reference qualities for each traded market. This means it can be traded as any other commodity – anonymously through the NYTEX platform and directly from seller to buyer through its tTrader platform.
With NYTEX and its development of ACIMAS™ (the Advanced Circuit Intelligent Management Algorithm System), how minutes are traded has been changed forever. ACIMAS™ transforms this highly differentiated product into a standardized commodity, just like oil, orange juice or gold.
The NYTEX Platform was designed for the telecommunications industry based on today’s needs of the industry and is based on four key pillars:
- Telecommunications as a Commodity
- Anonymous Trading
- Quality of Service through ACIMAS™ Algorithm
- Financial Security
Telecommunications as a Commodity
Telecommunications has never been traded efficiently because there were no true standards for international call termination. Every transaction was based on a unique set of product parameters. By developing a reference quality for each market based on what 80% of the market is expecting, telecommunications becomes a commodity and can be traded as such because sellers know what they have to deliver and buyers know what they are buying. NYTEX has also introduced the concept of trading “blocks” of minutes. So a price can be established like other commodities based on supply and demand.
Anonymous Trading
Because NYTEX has created a telecommunications commodity, sellers sell into a “market” rather than to a specific buyer. Buyers similarly purchase from the “market” rather than from a specific seller. This means trades can be anonymous – just like a stock market.
Quality of Service
Through its proprietary ACIMAS™ (Advanced Circuit Integrated Management Algorithm System) algorithm NYTEX also manages the quality of service based on the established commodity reference quality by market. NYTEX tests all circuits every 60 seconds. Sellers will only be able to deliver the minimum reference quality and buyers will only receive that reference quality. For sellers, this means that they will not be taken completely out of route if some or all of their circuits fall below the reference quality. Those circuits will simply shut down until their quality returns. On the buyer side, the NYTEX system adjusts circuits in real time so that they always receive the quality they paid for.
Financial Security
All NYTEX participants can rely on a safe and secure payment system. NYTEX clears all financial transactions accurately and expeditiously. Sellers are assured of receiving payment and buyers are similarly assured that their payments will be applied to their services appropriately.How NYTEX works
NYTEX is an easy to use online platform where you can sell or buy blocks of minutes for a specific market at a fixed price or buy minutes continuously based on a variable “spot” price. NYTEX functions much like a traditional commodity exchange with similar internal operating units.
For more information: Nytex Rulebook 
NYTEX User Manual
Block Trading
NYTEX works like any other commodity exchange. Sellers post the price they want to receive for a specific block of minutes (the "ask"). NYTEX posts this "ask" with a small transaction fee and the combined price is what is seen by buyers. Buyers on the other side of the transaction post what they are prepared to pay (the "bid"). When the "ask" and "bid" match, a transaction occurs. NYTEX clears both the financial transaction and the transiting of minutes (at the point in time when the buyer decides to use them). Blocks of minutes purchased never expire - buyers can use them any time.
Continuous Trading
Some markets have minutes available for purchase on a continuous basis. Buyers post the maximum price they are prepared to pay for a market and as long as the spot price is below that amount, traffic flows. Buyers in this case pay only the market price at the time.
NYTEX Internal Operating Units
NYTEX has several internal operating units which function like a traditional exchange.
These include:
| Compliance | to monitor that the rules of the exchange are being followed |
|---|---|
| Enforcement | who support liquidity for NYTEX markets |
| Network Operations Center | to manage technical operations |
| Clearing | to clear all NYTEX transactions |
| Credit Risk | to assess credit worthiness of NYTEX buyers |
| Back Office | to execute all normal business operations |
Telecommunications Technology at the heart of NYTEX
The ability of ACIMAS™ to manage and sort the quality telecommunications is what has enabled NYTEX to create an exchange that allows telecommunications to be a true commodity. This is accomplished through 4 key mechanisms:
- The concept of block trading, where a block of minutes is traded at a contracted price instead of being transacted on a per minute basis.
- The creation of a reference quality minute for each market. A minute is now standardized just like a barrel of oil. ACIMAS™ ensures that like oil transactions, if there is a contract for a specific grade and quantity - that is what will be delivered. For telecommunications this means that ACIMAS™ works for the sellers by measuring in real time the quality of their minutes and adjusts the delivery so that only minutes meeting or exceeding the reference quality are actually delivered to the buyer.
- The establishment of a distinctly identifiable commodity represented by a unique ticker for each NYTEX market consisting of a country and network operator. As an example, minutes terminating in Mali to mobile operator Malitel, would be considered a distinct market and represented as “MLMA”. So there can be several markets within a given country.
- The NYTEX Trading Floors (the fully integrated USD and EURO trading floors) which is the neutral meeting point for buyers and sellers and provides both technical and financial clearing of all transactions.
ACIMAS™ - The NYTEX Quality Advantage
NYTEX works via a wide range of circuits which are controlled by its proprietary Advanced Circuit Integrated Management Algorithm System or ACIMAS™. ACIMAS provides real time dynamic management and adjusts all circuits every 60 seconds in order to achieve a country network’s reference quality at the best price achievable.
ACIMAS prevents poor quality calls including, one way audio dead air false answer supervision and poor voice quality.
The NYTEX Advantage for Buyers and Sellers
NYTEX also provides its users with a full array of value added services:
| For Sellers | For Buyers | |
|---|---|---|
| Elimination of Credit Risk | Streamlined Payment Terms | |
| One Interconnection – Multiple Buyers | One Interconnection – Multiple Sellers | |
| Easy Access to Funds | Secure Banking | |
| Ability To Send Traffic Even When Your Performance is Below Reference Quality | Ability To Take Advantage of Cheap Routes | |
| No Fees – the price you post is what you receive | No Fees - What you see is what you pay |
tTrader™ Switchless Brokerage
NYTEX’s tTrader™ is the only tool needed to set up a telecoms brokerage. tBroker™ will be of particular interest to telecoms brokers and financial investors who want to trade Telecom Commodities, but do not want to invest in telecoms equipment, billing and rating systems, data centers, accounting and collection departments, a credit line at the bank, back office support and 24/7 NOC.
tBroker™ features:
- Real-time P&L tools – view profit credited to brokerage account as traffic is terminated.
- No credit risk - NYTEX is fully capitalized and acts as a central clearing house taking on the risk of default by market participants.
- One interconnection opens many opportunities – access a network of over 300 carriers with demand for billions of minutes per month without any upfront costs.
- Earn commission and market spread – Brokers earn commission for trading traffic, and make additional spread margin
- Eliminate disputes – NYTEX’s reliable and accurate billing system provides real-time traffic information eliminating disputes.
USD and Euro Trading Floors
NYTEX offers seamless trading in both US dollars and EUROs through respective trading floors. The trading floors are fully integrated incorporating real time currency exchange so transactions can take place on either platform without incurring a currency risk.
Corporate Underwriting for Network Operators
Since minutes on NYTEX have an established value, Network Operators can now use the underlying value of their commodity for internal financing. As a Network operator you can raise funds by making available blocks of minutes to investors for release into the market in an orderly fashion in accordance with NYTEX guidelines. Neutrality ensures that NYTEX always works in the best interest of its clients without conflict of interest.
The NYTEX Index
NYTEX has created its own index – the NYTEX 100™ which tracks the top 100 telecom markets by value in real time. Like the Dow Jones, this gives market participants a solid market reference point.
Market Intelligence
NYTEX follows telecom markets very closely – providing accurate and up to date intelligence for market traders on key factors that affect price of the minutes - which can lead to strong buy, sell or neutral trading. NYTEX also supplies core market information – the basic metrics on markets such as number of subscribers, competition, growth parameters and historical information to aid in trading decisions and monitors for updates in dialing codes.
NYTEX Delivery Points
A NYTEX Delivery Point is another unique concept which consists of specialized equipment provided by NYTEX to network operators. This allows them to supply the exchange directly and decide when and what to offer the market; meaning they now have more control and a clear alternative to their traditional distribution channels.