FiNETIK – Asia and Latin America – Market News Network

Asia and Latin America News Network focusing on Financial Markets, Energy, Environment, Commodity and Risk, Trading and Data Management

Thomson Reuters Opens RICs to all with Non-Realtime License

Thomson Reuters is taking a step toward answering client calls for more open access to its Reuters Instrument Code (RIC) symbology. The company is making RICs available for use with non-real-time information in client and non-client financial institutions’ trade processing systems.

Enterprise content chief Gerry Buggy, who has spearheaded Thomson Reuters’ response to the EC anti-competition complaint, the new facility is the “first step in supporting the financial community’s symbology needs across all parts of the trading life cycle through our evolving symbology services.”

The move comes in the wake of the EC investigation and subsequent complaint into the use of RICs in real-time consolidated data feeds. In response to that complaint, many financial services practitioners have called for more open access to the RIC, which is entrenched in many firms front-, middle- and back-office trading and trade processing systems.

According to Jason du Preez, Global Business Manager, Enterprise Platform, at Thomson Reuters, the latest initiative “has nothing to do with the EC investigation. The EC is focused on use of RICs for accessing real-time information, while the new licences are focused at firms looking to trade with the RIC or use the RIC to access non-real-time information.”

Du Preez says that latest move means that “any market participant can buy a license that will allow them to trade using the RIC. This will allow the use of the RIC for pre- and post-trade activities, and the right to redistribute RICS in this regard.”

The new RICs arrangement will allow market participants to use and cross-reference the RIC symbol for trade activities. As such, it can be used to facilitate the advertisement of liquidity, acceptance of trade flow and execution of post trade activities with the RIC symbol as a consistent identifier throughout the process.

Additionally, the service will allow Thomson Reuters pricing and reference data customers to use RICs to reference and retrieve securities data from their securities master databases and navigate to connected content such as legal entity identifier (LEI) information.

Du Preez says that “Firms that purchase reference data from Thomson Reuters will also be granted the right to use the RIC to access any non-real-time information, essentially allowing them to use the RIC to access any content, including third-party party content, held in their securities master databases.”

Thomson Reuters believes the new service will encourage more efficient and reliable capital markets by giving market participants the freedom to use RICs symbols irrespective of whether they use Thomson Reuters enterprise data products.

As part of the latest initiative, the Bats Chi-X Europe exchange has signed up for the service, which will allow it to deploy RICs in the post-trade services it offers.

According to Paul O’Donnell, COO at BATS Chi-X Europe, “Cross-referencing the BATS Chi-X Europe instrument codes with the Thomson Reuters RIC symbols will enable us to reach new market participants as well as improve efficiency and data transparency by facilitating accurate identification of securities on our platform.”

Du Preez says obvious candidates for adopting the new arrangement include “trade hubs, third-party trade/post-trade processing firms or anyone that wants to send, receive or cross reference messages that contain securities identified with a RIC.”

Source: A-Team Reference Data Review 27.06.2012

Filed under: Data Management, Data Vendor, Reference Data, Standards, , , , , , , , , ,

BM&F BOVESPA News June 2010

“Brazil Easy Investing” will allow foreign investors to order routing in their local currencies
BM&FBOVESPA and Chi-X Global are jointly developing an order routing software designed for the trading of Brazilian equities in foreign currencies.
Launch of five new Currency Futures Contracts in the BM&F segment for trading
Australian Dollar (AUD), Canadian Dollar (CAD), Japanese Yen (JPY), Pound Sterling (GBP) and Mexican Peso (MXN) contacts are authorized for trading.
DMA trading reaches historic levels in the BM&F segment
Derivatives trading via Direct Market Access (DMA) set a new record in May, with 20,949,961 contracts traded in 3,040,357 trades. Other records were set during the same period.
Bidding Process for the selection of a manager for the new financial ETF
Interested financial entities must submit their proposals by no later than July 19th. The winning bidder will be the entity that provides the highest value commitment.
Important agreement to stimulate the relationship between entrepreneurs and investors
The partnership of BM&FBOVESPA and São José dos Campos Technology Park hopes to establish a culture of entrepreneurship and innovation, through professional training.
Brazil elected as the most trustworthy country among the developing nations for doing business
A survey of investors from all over the world showed that they considered Brazil to be the developing country with the best corporative governance.
WFE Working Committee Meeting will be hosted by BM&FBOVESPA
BM&FBOVESPA will host the World Federation of Exchanges (WFE) Working Committee on July, 1st and 2nd, in São Paulo. Main topic to be discussed will be “Sustainable Investment”
Corporate Sustainability Index (ISE) completes five years with enhancements to the next portfolio
The companies listed on ISE are recognized for their high level of commitment to sustainability and social responsibility.
MARKET RESULTS – BM&F Segment May 2010
The derivatives market segment totaled 52,063,826 contracts and BRL3.57 trillion in volume. The average daily trading volume in the derivatives markets was 2,479,230.
The equities market segment reached a total volume of BRL152.93 billion, in 10.261.145 trades, setting a new record, with daily averages of BRL7.28 billion and 488,626 trades.

Source: BM&FBOVESPA, 30.06.2010

Filed under: BM&FBOVESPA, Brazil, Exchanges, Latin America, News, , , , , , , , , , , , , , , , ,

Dark Pools: HKEx chairman slams dark pools

Ronald Arculli joins the ranks of those criticising alternative trading platforms for creating an unfair playing field.

Much has been said and written in recent months about dark pools, and on Wednesday the chairman of Hong Kong Exchanges and Clearing threw his hat into the ring. Not surprisingly, Ronald Arculli is not in favour of such trading platforms, which only require prices to be published after a transaction is complete.

He set out his stall in a speech at the Foreign Correspondents’ Club in Hong Kong titled ‘Roles and Challenges of Stock Exchanges’. Highlighting the benefits of exchanges (good risk management, transparency, liquidity fairness, a reliable infrastructure and central counterparty services, among other things), he said they demonstrated their worth during the crisis: “Almost all exchanges continued to function normally and remained open during the turmoil.”

Arculli also remarked that governments worldwide have recognised the “unique value” of exchanges, with a number of moves afoot to standardise over-the-counter contracts and move them onto exchanges. This is in stark contrast to well publicised concerns of regulators, such as the US Securities and Exchange Commission, as to whether dark pools create unfair advantages for some in the market. Arculli believes they do and clearly outlined his concerns.

Firstly, these platforms lack transparency, as they show buy and sell orders and deals that are not transparent or available to the general investing public, he argued, effectively creating a two-tiered market. They are typically run by broker-dealers and large market-makers looking to save on transaction costs and fees, and do not alert the broader market of impending deals which could affect a stock’s equilibrium.

Powerful technology can be used to conduct high-frequency algorithmic trading in dark pools through both on- and off-exchange platforms to profit or arbitrage on small price differences, said Arculli. This has resulted in dark pools accounting for 12% of market trades in the US now, up from 1.5% just five years ago, while in Europe they account for some 4% of equity trades. In Asia, these venues make up a much smaller percentage of the average daily turnover, he added, but in a globalised marketplace, they still raise significant concerns.

Besides transparency, another issue is that the proliferation of alternative platforms means liquidity is increasingly fragmented, diverting volumes away from publicly traded exchanges, he said. Smaller companies may suffer as high-frequency traders tend to prefer larger, more liquid shares. Such fragmentation not only affects effective price discovery, said Arculli, but also increases price volatility and adds to surveillance difficulties.

Moreover, the lack of regulation and transparency of dark pools could result in notable systemic risk, he said, citing the problems surrounding Lehman Brothers and AIG last year. “As dark pools typically lack a central counterparty, the default of a large participant could have severe consequences on market stability,” he said.

In addition, these platforms raise concerns over company ownership. “Arguably when shares are held only for fractions of a second, it is no longer about participating in the ownership of a company or ensuring it is well run,” he said. “The opaqueness of trading, and its fragmentation have negative implications for effective corporate governance.”

Arculli suggests the rise of such platforms set up by investment banks might indicate a trend towards the re-mutualisation of stock trading. Originally stock exchanges tended to be set up as associations by their trading members, he said, but have since de-mutualised and become commercial, often listed, corporate entities to better serve their stakeholders.

“Now as the bigger trading participants are getting together again to create their own networks, is the trend reversing?” said Arculli. “Complicating matters even further, some exchanges have decided to join the fray and team up with large institutions to set up their own dark pools.” Singapore Exchange’s recent tie-up with Chi-X is one such example. Other trading platform providers, such as Liquidnet, are also working on expanding into Asia.

Arculli went on to say that regulators in the EU and the US have been reviewing dark pools and considering stricter measures to ensure a fair and stable trading environment. Investors — especially institutional ones — are seeking better, faster and cheaper services for more computerised methods of trading. Hence, he added, exchanges must continue to offer better execution and more efficient pre- and post-trade services to stay competitive, while protecting investors.

Despite his worries, Arculli, said, competition is welcome. China, for example, has the capacity and the need for more than one successful financial centre. But he added a caveat.

“We welcome challenges that strengthen our markets and make them more effective and efficient,” said Arculli. “But we are concerned by those that increase systemic risk or disadvantage a certain segment of investors to the benefit of others.”

Source:, 11.12.2009

Filed under: China, Exchanges, Hong Kong, News, Risk Management, Singapore, Trading Technology, , , , , , , , , , , , , , , , , ,

Dark Pools in Danger ?

Increasing regulatory supervision and calls for transparency on one side and  the threaten proliferation of “unregulated and opaque”  Dark Pool and crossing networks by large institutions, have increased the calls by exchanges and exchange federations to review regulation and even ban them.

While the global debate is in full swing, China has clearly distance it self from any alternative trading venues in the country and prohibited the access to any “non-transparent” trading venues like dark pools for it’s QDII (Qualified Domestic Institutional Investors).

Below Article highlight the current trends and voices

SEC to extend probe into dark pools 09.10.2009

The Securities and Exchange Commission is to extend its regulatory probing of dark pools to include issues surrounding high frequency trading, direct market access and co-location.

What’s the Matter with Dark Pools, 02.10.2009

Dark pools are on the regulatory front burner. They’re seen as competing with the displayed markets, even as they’ve captured a segment of trading from the desks of broker-dealers’ upstairs.

The Securities and Exchange Commission is now bearing down on issues related to trading in dark pools and how much flow can execute in individual pools without triggering obligations to the rest of the marketplace. To provide some perspective on this broader discussion….

LSE and Turquoise an Item: Official, 01.10.2009

When we suggested here a few weeks back that the London Stock Exchange take a look at on-the-block Turquoise as a possible solution to its ‘TradElect problem’ it was slightly tongue in cheek. After all, we knew the LSE was in talks with MillenniumIT and it looked on paper as if an approach to Turquoise would amount to the exchange losing face to an upstart rival.

Dark Pools 2009: Not So Dark Anymore AITE Group, 30.09.2009

Only two things about dark pools are clear at this time: their overall market share continues to grow, and regulatory intervention appears inevitable.

London Stock Exchange to leave FESE  30.09.2009

But the move is a sign that a recent criticism by some of the world’s largest exchanges of the large banks’ off-exchange activities is not shared by some exchanges, which see their interests increasingly aligned with those same banks.

n a letter to Eddy Wymeersch, chairman of the Committee of European Securities Regulators, Ms Hardt said FESE believed the banks’ dark pools were “unregulated venues” operating with “full opacity”. The European equities market was “becoming a dealer market”.

Chi-X Global alleges ‘fear card’ move by ASX 30.09.2009

The head of Chi-X Global, the equities trading platform, on Wednesday accused the Australian Securities Ex­change of playing the “fear card” after the exchange’s chairman spoke of the dangers of allowing multiple share trading venues.

New ideas fail to lift mood over dark pools 24.09.2009

Yet even as dark pools continue to generate eye-catching ideas, controversy is raging over their very existence. In Europe, the issue is pitting exchanges against big banks in a new battle over control of billions of dollars in share trading orders.

Exchanges call on G20 to tackle dark pools 23.09.2009

The World Federation of Exchanges (WFE) has urged G20 leaders to press for market reform to tackle the uneven playing field and eroded price discovery it claims has been caused by the emergence of alternative trading platforms such as dark pools.

In a letter sent to Mario Draghi, head of the financial stability board at the Bank for International Settlements ahead of the G20 summit in Pittsburgh, the WFE calls for more uniform rules between exchange-traded and “less-regulated” markets.

The WFE warns: “The heightened opacity of certain market operations in many countries inhibits price discovery and may lead to negative outcomes, such as increased volatility.”

“Taken together, the combination of the absence of a level playing field between execution venues and decreased market transparency is an unsettling development,” says the letter, signed by William Brodsky, chairman of the WFE.

The exchanges call on G20 leaders to agree on ways to avoid “regulatory arbitrage” to ensure market participants do not just go to countries with weak rules.

Source: Finetik, 01.10.2009

Filed under: Australia, Exchanges, FiNETIK Articles, Japan, News, Risk Management, Trading Technology, , , , , , , , , , , , , , , ,

ATS Alternative Trading System Guide September 2009

A-Teams ALTERNATIVE TRADING SYSTEM directory covers alternative trading venues for listed securities: equities, futures and options, and their associated, listed financial instruments in the US and Europe.

For a free download go to  A-TEAM Alternative_Trading_Systems_Directory 09.2009

The A-Team Alternative Trading Systems Directory gives perspective to today’s confusing global trading platform landscape, with descriptive information for a comprehensive list of alternative venues. Electronic trading platforms offering alternative liquidity venues from the world’s primary exchanges has expanded significantly in just the past year.

This has been particularly true in Europe, where the EUs Markets in Financial Instruments Directive (MiFID) has spawned a host of Multilateral Trading Facilities (MTFs) and encouraged the proliferation of both independent and broker-sponsored dark liquidity venues, or dark pools. In short, the ATS landscape has become more complex than ever. The Alternative Trading Systems Directory sheds light on the activities of ATSs worldwide and helps clear up the confusion.

Source: A-TEAM, 28.09.2009

Filed under: Exchanges, Library, News, Trading Technology, , , , , , , ,

Chi-X Global alleges ‘fear card’ move of ASX (Dark Pool)

The head of Chi-X Global, the equities trading platform, on Wednesday accused the Australian Securities Ex­change of playing the “fear card” after the exchange’s chairman spoke of the dangers of allowing multiple share trading venues.

The development is a sign of frustration over the absence of government approval of licences that would allow rivals to challenge the country’s incumbent exchange.

At the same time, regulatory scrutiny in the US and Europe of certain off-exchange venues has emboldened exchanges such as the ASX to become more vocal in criticising alter­native trading platforms.

Tony Mackay, Chi-X Global chairman, hit out at the “extraordinary” comments made by ASX chairman David Gonski, who told shareholders at an annual meeting that Canberra should carefully consider whether to allow new entrants into the country’s markets. He claimed that it was unclear how multiple market operators benefited investors. He said Mr Gonski was playing the “fear card” that competition was bad for Australia.

Chi-X Global, controlled by Nomura of Japan, has been in talks with Canberra for more than a year about securing a market licence to offer equities trading. Its sister company, Chi-X Eur­ope, already operates a pan-European equities platform.

Mr Mackay added: “The … ASX operates a regulated monopoly. It has an average operating margin of about 80 per cent when the average for the companies quoted on its exchange is about 25 per cent.”

He said the average cost of executing a trade in Australia was close to five times higher than in Europe and North America.

“They are fighting to keep their monopoly,” he said, adding that the ASX should discuss with government, regulators and new market entrants Australia’s role as a leading securities market in the region.

Source: FT, 30.09.2009

Filed under: Asia, Australia, Exchanges, News, Services, Trading Technology, , , , , ,

Exchanges in a Race to Zero Latency

Nasdaq OMX Group said earlier this month that upgrades to its technology have made it the fastest exchange in the world. That may or may not be true but regardless, the exchange operator’s announcement highlights a drive this year by market centers to reduce the latency of their systems.

Behind the trend is the desire to appeal to such latency-sensitive traders as direct market access and algorithmic players. These folks which include high-frequency traders, bulge bracket prop desks and the electronic trading departments of large broker-dealers want their orders processed as quickly as possible.

“If we’re not building a low latency competitive exchange, we’re just not going to be in the game,” Brian Hyndman, senior vice president for transaction services at Nasdaq, said at last week’s Aite Group conference on high-frequency trading.

Nasdaq reported on September 9 that upgrades to its INET platform and other parts of the technology that underlie five of its trading venues have given Nasdaq an average latency of less than 250 microseconds. That’s faster than BATS Exchange, which pioneered low latency trading. BATS announced in June it executes 80 percent of its orders in under 400 microseconds.

The upshot, according to Hyndman, is that latency has gone down, throughput has gone up and order acknowledgement times are more consistent. “We eliminated the outliers,” Hyndman said. “That’s very important to a lot of Nasdaq’s customers.”

This means, Hyndman explains, that a trader won’t get an order acknowledgement in 250 microseconds on one trade and three milliseconds another time. “There will be no big spikes in standard deviation,” the executive said.

(One millisecond equals one thousandth of a second. One microsecond equals one millionth of a second.)

Besides the changes to INET, whose main feature is the order-matching engine, Nasdaq also upgraded its network to 40 gigabits per second from a 10-gigabit connection; upgraded its hardware; and made a variety of other changes.

Nasdaq’s announcement was just the latest. Ever since June, all five of the major U.S. trading venues as well as one in Canada have put out notices describing the steps they have taken to cut their processing times.

On the same day Nasdaq made its announcement, Chi-X Canada ATS, owned by Instinet, claimed it was the fastest market center in Canada.

The ECN said it boosted its capacity to be able to handle 175,000 messages per second, a 500 percent increase from previous capacity of 30,000 messages per second. Chi-X Canada has benchmarked its average response time for marketable immediate-or-cancel orders at about 350 microseconds. That’s at least 10 times faster than any other major Canadian market center, it contends. Previously, Chi-X Canada’s internal latency was pegged at 890 milliseconds.

“We need to keep up with our customers,” Tal Cohen, Chi-X Canada’s chief executive, said. “The drive for latency is not slowing down anytime soon.”

Chi-X Canada, based on the same technology as Chi-X Europe, launched in February 2008. Cohen said part of Chi-X’s strategy to drive latency lower is to run the system on “commodity” hardware. That way, the ATS can simply plug in the newer and faster boxes once they become available.

Both BATS and NYSE Arca also announced latency reductions this summer. BATS cut its average latency, or the amount of time it takes to execute an order, by 50 microseconds to 395 milliseconds. It also announced that it can now convert an order into a quote for transmission on its market data feed in 631 microseconds.

NYSE Arca, a unit of NYSE Euronext, announced that its order acknowledgement time, the time it takes to confirm receipt of an order, had been reduced to under one millisecond for Tape A and Tape B names and under 650 microseconds for Tape C issues.

Perhaps the summer’s most symbolic announcement came from NYSE Arca’s sister exchange. The New York Stock Exchange said in July it scrapped its 33-year-old SuperDOT platform order delivery and processing system, as well as an internal routing system called Post Support System. In its place, the NYSE installed its Super Display Book system, technology based on NYSE Arca’s trading engine.

The move cut the time it takes to execute an order from 105 milliseconds to five milliseconds, according to the exchange. That’s down from 350 milliseconds in 2007. NYSE customers now get order and cancellation acknowledgements in two milliseconds, the NYSE added.

Five milliseconds is a far cry from Nasdaq’s 250 microseconds, and NYSE executives acknowledge they still have work to do. Still, the rollout this summer of the Super Display Book system was the culmination of an 18-month project that saw the Big Board completely reengineer its underlying hardware and software architecture using technology it acquired with the purchases of Euronext, Wombat Financial Software and Archipelago. The NYSE completely replaced its order entry, order database and routing systems, market data systems and pieces of its post-trade system.

The move to revamp its dated infrastructure potentially opens doors that were previously shut to the NYSE. At least one bulge shop refused to send any of its algorithmic flow to the NYSE because it was too slow, an NYSE exec told Traders Magazine.

On the other side of the Hudson River in Jersey City, N.J., technicians at DirectEdge ECN have also been ripping out old and installing new technology.

DirectEdge has seen its share of trading volume shoot from about 5 percent a year ago to about 12 percent today. To deal with the increase in messages flowing through its systems and prepare for the future, the ECN chose to replace its messaging middleware, TIBCO. It chose faster technology from 29West, a relative newcomer to the business. DirectEdge says installation of 29West’s technology has produced a “dramatic reduction in overall system latency” and increased its throughput.

“It allows us to use persistent messaging without the penalty,” said Steve Bonanno, DirectEdge’s chief technology officer. Persistent messaging is typically slower than non-persistent messaging, but offers guaranteed delivery. No messages are lost as they can be with non-persistent messaging. 29West’s technology eliminates that latency “penalty,” Bonanno explained.

DirectEdge is now able to guarantee its customers an order response time of 300 to 500 microseconds. That’s measured from the time the order enters DirectEdge’s gateway to the time the acknowledgment hits the gateway. Previously, response times of DirectEdge’s three trading platforms were in the 1.2- to 1.5-millisecond range.
Although DirectEdge needed the changeover to 29West primarily for throughput, it couldn’t ignore latency. “Speed is the toll you have to pay to be in this business,” Bonanno said. “Being fast is a given. That has to be there.”

All things are relative, of course, and speed is no different. Market centers are forever engaged in a ferocious battle with each other to win market share. In their desire to impress traders, they will often put out overly rosy latency numbers, critics charge. “There is a lot of confusion, and, in some cases, obfuscation about the actual latency at the venues,” said Donal Byrne, chief executive of Corvil, a Dublin, Ireland-based maker of latency monitoring and management tools. “It is impossible to make apples-to-apples comparisons.”

That applies to both the speed at which the venues disseminate market data as well as the speed at which they convert orders into trades, Byrne added. The problem is that the venues typically offer up an average number, which may be of little use. “If you measure it at one time, you get one number,” Byrne said. “If you measure it a few seconds later, you get another.” He believes trading venues should publish a schedule of numbers for all times during the trading day.

Doug Kittelsen, chief technology officer of execution management vendor FTEN, is also concerned. He believes exchanges should quote their latency data in the 95th percentile, or at the slow end of the spectrum, rather than the median or average, which is standard. “You want to see what the curve is like all the way through to the end,” Kittelsen said, “not just the middle.”

Source: Traders Magazin: 25.09.2009

Filed under: Data Management, Exchanges, Market Data, News, Trading Technology, , , , , , , , , ,

Dark Pools:New ideas fail to lift mood over dark pools

This week, Liquidnet, a US operator of “dark pools”, unveiled the latest device to emerge in European share trading, which it called “Supernatural”.

The company claims it will help European fund managers increase their chances of finding matches for large blocks of shares in Liquidnet’s dark pool by linking it up with other exchanges, brokers and alternative trading platforms such as Chi-X Europe.

Yet even as dark pools continue to generate eye-catching ideas, controversy is raging over their very existence. In Europe, the issue is pitting exchanges against big banks in a new battle over control of billions of dollars in share trading orders.

Dark pools allow the matching of large blocks of shares without prices being revealed until after trades are completed. Regulators on both sides of the Atlantic are studying them amid questions over their transparency.

Dark pools are not only run by companies such as Liquidnet; they are also operated by banks’ trading arms and exchanges. They have grown rapidly since first appearing in the US in the late 1990s, with at least 15 in existence in Europe.

The exchanges have launched an attack on the proliferation in Europe of pools run by the banks – such as Goldman Sachs, Credit Suiss, and Morgan Stanly – arguing they are operating outside the view of European regulators. 

Mifid launched competition in European share trading in 2007, leading to an explosion of new type of trading venues.

The Federation of European Securities Exchanges, whose members include Deutsche Börse  and Euronext , wrote this week to the Committee of European Securities Regulators in Paris, claiming banks’ dark pools were “unregulated venues” operating with “full opacity”.

It said that under Mifid, crossing networks were supposed to register under certain formal categories that would subject them to the same market surveillance and price reporting requirements as exchanges.

Yet many were not, FESE claims. “Practically all of this trading is outside the realm of European rules and thus beyond the reach of supervisors,” wrote Judith Hardt, FESE secretary general, in the letter to CESR chairman Eddy Wymeersch, a copy of which was obtained by the Financial Times. “As a result, more trades are being executed away from the public view, without interacting with other orders, and at prices that may not be optimal for clients.”

She argued that European equity markets “are becoming a dealer market”.

The banks are furious. They see the FESE move as exchanges exploiting post-crisis concerns over off-exchange markets to persuade policymakers of the benefits of channelling trading of stocks through regulated exchanges.

Dark pool trading accounts for about 4 per cent of all trading in Europe, according to consultancy Tabb Group. But it is growing, and with the proliferation of the types of “dark” trading venue unleashed by Mifid, bankers say exchanges fear trading could shift further away from them. “The exchanges are opportunistic, fear-mongering. And it’s pretty clear why: commercial interest,” says one.

The banks reject the notion that their crossing networks are unregulated, pointing out that broker-dealers are already regulated, and the banks’ clients – such as money managers – are regulated.

They also argue that their dark pools perform a legitimate function at a time when large orders are increasingly hard to execute on exchanges as complex electronic trading strategies slice orders into smaller and smaller sizes.

They reject the FESE view that investors are at a disadvantage by the alleged “opacity” of bank dark pools. They say that many of the block trades being carried out in them are placed by the banks’ asset manager clients, which in turn are handling funds placed with them by millions of ordinary investors.

The problem, industry experts say, lies with Mifid itself. Exchanges say that bank dark pools are not required to report trades in a coherent way, or even at the same time as those trades reported to the market by exchanges. Mifid is unclear on the issue.

Steve Grob, director of strategy at Fidessa, a trading technology company, says: “The reporting environment in the US is much more transparent. There needs to be some clear regulation about how they report what they do.”

Niki Beattie, managing director of The Market Structure Practice, a consultancy, says: “The thing is that brokers are governed by a certain set of rules and exchanges are governed by another. Mifid failed to move with the times.”

She believes, however, that Mifid has given brokers an “unfair advantage” over exchanges. “They are both trying to be liquidity pools and [Mifid] has given the brokers an unfair advantage,” says Ms Beattie, a former trading strategist at Merrill Lynch.

CESR is studying the issue. Last week Charlie McCreevy, European Union internal markets commissioner, said dark pools would form part of the European Commission’s planned review of Mifid. That would focus on whether the growth of those operated by broker-dealers gives their backers “unfair commercial advantages” in the market.

With dark pools under attack more broadly, banks may have a tough job making their case. Ms Beattie says: “The exchanges probably have some right to be out there questioning this.”

Source: FT, 24.09.2009 by Jermy Grant

Filed under: Exchanges, News, Risk Management, Trading Technology, , , , , , , , , , , , ,

SGX/Chi-X dark pool could revolutionise Asian trading

Buy-side traders, dark-pool brokers and technology providers are encouraged by Singapore Exchange’s announced dark-pool JV with Chi-X.

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The two biggest problems when it comes to trading equities in Asia have been fragmentation and monopolisation. The region is broken into a number of different markets, with their own regulation and structures, and about the only thing they have in common is that trading tends to be monopolised by a single exchange.

The advent of electronic trading and the emergence of alternative trading venues — first in America, then in Europe — offers potential solutions to these, but has been seen as a threat by the stock exchanges. As a result, alternative trading venues in Japan, for example, have struggled to get more than 1% of daily turnover.

This week’s announcement by Singapore Exchange (SGX) that it is setting up a joint-venture with Chi-X to establish a pan-Asian dark pool could prove a watershed event.

SGX is the smallest of the exchanges in developed Asia-Pacific (compared with Tokyo, Osaka, Sydney and Hong Kong), and has long had ambitions to punch above its weight by promoting itself as a regional hub. Although it has notched some successes in attracting international listings and tradable products (90% of its listed derivative products, for example, are from other countries), it has not been able to convince other markets to have their securities traded in Singapore, or vice versa.

The deal with Chi-X should change this. SGX has cast aside the typical aversion to new forms of electronic trading and embraced them instead, and as a result has furthered the cause of best execution across the region.

“To see Singapore Exchange back a crossing network has to be seen as positive,” says Richard Coulstock, regional head of trading at Prudential Asset Management. He and other buy-side traders welcome a platform that, by making itself available to both the buy and sell sides, could help aggregate other dark pools of liquidity.

Other electronic trading networks welcomed the deal. “We like this because it shows alternative trading venues are necessary for the region,” says Greg Henry, who runs Liquidnet in Singapore. “What’s now important is to get market participants to buy into it.”

Danny Lee, Asia director at NYFix in Hong Kong, says the next step is to enable regional crossing on the new dark pool, which requires a central counterparty to clear trades in other markets. If that happens, he says, “The Chi-X and SGX deal should light something up.”

SGX is confident the dark pool, once it goes live, can be extended to other markets without too much difficulty.

Chew Sutat, executive vice-president and head of market development at SGX, explains the main hurdle is getting other jurisdictions to amend some regulations. SGX has already received several expressions of interest from entities that could play the central counterparty role. Settlement can be handled by a custodian bank and depository agencies.

SGX is keen to extend the dark pool to onshore markets among other developed markets, with Japan, Australia and Hong Kong the priorities. The technical issues vary among them. For example, the SGX/Chi-X dark pool will be able to handle Japanese securities so long as they are traded among parties outside of Japan; but the dark pool will remain out of bounds to Japan’s domestic institutional investors. The JV expects to negotiate with officials in Tokyo to see if this can be changed. Hong Kong and Australia are more open but have regulatory hurdles of their own.

The regulatory side may remain an unknown, but Chew sounds confident that the new JV will attract participants. He says a number of fund managers and brokers have already been in touch, wanting to know when and how they can connect. “We still need to get a license,” he says, noting the application to be a recognised market operator is being sent to the Monetary Authority of Singapore.

The parties hope the JV, which has yet to be named, will go live in the first half of 2010. Chew says one reason for the interest is the prospect that such a dark pool will help grow the pie for all trading venues, by attracting more capital to the region.

He adds that SGX decided to partner with Chi-X not just for its technology but because its track record as a pan-European market segued with SGX’s ambitions to create a pan-Asian project.

Although dark pools are criticised for splitting up liquidity in already thin markets, the experience in the US and Europe suggests the opposite. Big trades placed on an exchange would have such a big market impact as to make them virtually impossible to do, except if done very slowly. Go into a dark pool — a Liquidnet, a BlocSec, an Instinet — and you can see if there’s a contra on an anonymous basis. If there is, fine, you can make a trade happen. If not, no harm done. The point is that dark pools should, in theory, make possible trades that would otherwise not occur in the ‘lit’ market.

Tony Mackay, CEO at Chi-X Global in Hong Kong, says the deal with SGX stemmed from Chi-X’s belief that each market should have a market for such block trades. The only way to do so, however, would be to collaborate with stock exchanges, rather than take them head on, and create a means of aggregating various dark pools. “In Asia, there is a real need among fund managers to concentrate liquidity,” he says.

He says the breakthrough was when SGX realised that, to be taken seriously as a pan-Asian trading hub, it had to allow others to trade Singapore shares first. The resulting JV should break the ice and encourage other regulators and exchanges to consider similar moves.

Australia is seen as the next likely domino. For years, brokers and institutional investors have agitated for recognised alternative trading venues other than the Australia Stock Exchange (ASX). Chi-X is among a handful of firms requesting such a license. The ASX is trying to build its own dark pool in time to meet what is considered an inevitable break on its monopoly. “We hope this [licensing alternatives] can be done quickly now,” says Mackay, adding he hopes Australia, Japan and Hong Kong can be added to the SGX JV dark pool sometime in 2010.

SGX’s Chew says the exchange would like to extend the dark pool from just cash equities to other products, including depository receipts and exchange-traded funds, which lend themselves to dark trading. But this is not the priority. “We will focus on where we see demand, which is in top-line blue-chip stocks,” he says.

Source:AsianInvestor, 14.08.2009

Filed under: Asia, Exchanges, News, Singapore, Trading Technology, , , , , , , ,

Chi-X Global and SGX to launch first exchange-backed dark pool in Asia-Pacific

Chi-X® Global Inc. (Chi-X) and Singapore Exchange Limited (SGX) have signed a Heads of Terms Agreement to develop and launch the first exchange-backed dark pool in the Asia-Pacific region. The non-displayed trading platform aims to initially offer block crossing facilities for equities listed on SGX, and on an offshore basis for the Australia, Hong Kong and Japan exchanges.

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Chi-X seeks new business model for Asia

A project implementation team has been formed with the goal of commencing operations and trading in the first half of 2010. The joint venture, which will be equally owned by the two sponsors, intends to implement specific strategies to equip its dark pool with ample liquidity and attract new capital flows to the region.

The dark pool will operate with appropriate regulatory approvals and controls, reporting, settlement systems and compliance standards.

“Chi-X is delighted to work with a forward-looking and market-focused partner like SGX to launch and operate this dark pool, with the aim of creating the deepest and most attractive dark pool liquidity in the Asia-Pacific region,” said John Lowrey, CEO of Chi-X Global. “Our experience has shown that users are looking for independent, genuinely neutral dark pools with high functionality and deep liquidity, and we believe that this joint venture will be able to deliver just that.”

“SGX is pleased to offer Asia the first exchange-backed dark pool, which will complement exchange trading by reducing the market impact of large trades. We believe it will be an important block trading venue for Asian markets, attracting new participants and improving the trading environment in the region,” said Gan Seow Ann, SGX Senior Executive Vice President and Head of Markets. “We are glad to have a strong partner in Chi-X, who shares with us common goals of being innovative and internationally oriented.”

Chi-X subsidiary Chi-X Global Technology, LLC (Chi-Tech), a provider of trading infrastructure solutions to global market centers and participants, will provide the technology for the platform. Around the world, Chi-X technology is powering a number of alternative and incumbent trading venues that are providing savings for investors through reduced market impact and improved liquidity.

SGX-listed stocks will be cleared and settled through The Central Depository (Pte) Limited (CDP), SGX’s securities clearing house and depository, via SGX’s securities clearing members. The JV intends to appoint a pan-Asian central counterparty to clear other trades executed on the dark pool.

Source: Automated Trader, 12.08.2009

Filed under: Asia, Exchanges, News, Singapore, Trading Technology, , , , , , ,

Industry Fears Proposal in Congress Would Destroy High-Frequency Trading and Liquidity

Trading industry experts said the passage of a new bill to tax each buy and sell transaction by up to 25 basis points would devastate liquidity in the equities market.
The proposed House of Representatives’ bill-H.R. 1068: Let Wall Street Pay for Wall Street’s Bailout Act of 2009-would, they say, dramatically increase trading costs, widen bid-ask spreads, kill off high-frequency market making firms, slash volumes and move trading to overseas markets.

“It would have a really major impact for the high-frequency players,” said Jeff Bell, with Wedbush Morgan Securities’ clearing and technology group. “It would end that whole business.”

Since equities began trading in penny increments in 2001, the trading industry has undergone a massive overhaul, moving to an electronic trading world. Today, roughly 65 percent of all volume is executed by high-frequency traders, who have replaced specialists and market makers who fled the inside market due to narrower bid-ask spreads that raised their risk profile.

The concern within the trading industry is that if high-frequency traders were taxed, they would exit the business, because their current razor-thin margins would turn to losses. The result? Liquidity would disappear for all market participants.

Wedbush clears the trades for many of the industry’s largest high-frequency firms. Bell calculated, for example, that Wedbush’s fee for the tax would have been more than an estimated $50 million on Monday alone for having done more than $20 billion worth of securities transactions that day.

“That’s a huge tax; 25 basis points is enormous,” said Dan Mathisson, the head of Credit Suisse’s Advanced Execution Services.

The proposed bill would add 5 cents per share to the cost of trading an average stock, at around $20 a share, Mathisson added. By comparison, electronic trading commissions for services cost a penny-or just under a penny.

“You’re talking about raising the trading costs more than five times,” he said. “That would bring liquidity presumably down to levels from 10 years ago, which is the last time transaction costs were that high. I assume you would see volumes drop from about 10 billion shares a day to one billion shares a day.”

Details for the bill have yet to be worked out. As written, the bill would amend the Internal Revenue Code of 1986 to impose a tax on certain securities transactions enough to recoup the net cost of the Troubled Asset Relief Program. Rep. Peter DeFazio, D-Ore., authored the bill.

DeFazio introduced the bill on Feb. 13. It has since been referred to the House Committee on Ways and Means, according to the House of Representatives’ Web site.

The bill’s findings argue that because the $700 billion TARP fund and the new Federal Reserve lending facilities were created to protect Wall Street investors, the same Wall Street investors should pay for the infusion of taxpayer money.

“The easiest method to raise the money from Wall Street is a securities transfer tax, a tax that has a negligible impact on the average investor,” the bill states. “This transfer tax would be on the sale and purchase of financial instruments such as stock, options and futures. A quarter percent (0.25 percent) tax on financial transactions could raise approximately $150 billion a year.”

The offices of Representatives DeFazio and Michael Capuano, D-Mass.-the only one of seven additional sponsors of the bill who is on the House’s Financial Services Committee-did not return calls for comment.

There is precedent for such a tax. The United States imposed a transfer tax of 0.2 percent on stock trades between 1914 and 1966. In addition, investors now pay the federal government $9.30 per million dollars of face value to fund the Securities and Exchange Commission-under Section 31 of the Securities Exchange Act of 1934.

With such a steep climb in transaction costs, high-frequency market makers operating on razor-thin margins would be the first to fall, several in the industry said. By some accounts, they comprise an estimated two-thirds of average daily volume.

And with less liquidity, by definition, spreads would widen, said Eric Hess, general counsel for Direct Edge ECN. They could widen by a factor as great as three or four, according to some estimates.

“It would have a cascading effect over time,” Hess said. “In the same way that liquidity begets liquidity, draining liquidity has the tendency to drain even more liquidity.”

The extra cost would most likely get passed on to investors. Because of tight margins, broker-dealers wouldn’t assume the cost themselves, unless they were for their own proprietary accounts, Hess added.

The Security Traders Association circulated a letter to its members earlier this week that described the tax’s potential impact. In it, the letter laid out the bill’s impact on high-frequency market makers and overall liquidity in the equities, options and futures markets.

“The deeper and more liquid the market, the better the price discovery and related information provided,” the STA letter said. “Impairment of liquidity lessens the value of the information and the functioning of a market-based economy.”

And with less liquidity, firms would be encouraged to trade overseas, where costs are cheaper, Hess said. Consequently, more companies could be encouraged to list overseas.

As many stocks can be listed overseas, the tax would create an immediate market for them. Market venues such as the Toronto Stock Exchange and or Chi-X, in Europe, could likely start listing U.S. equities, some industry pros said.

Mathisson laid out one scenario

“How long does it take for off-shore entities, such as the Chi-Xs of the world, or the London Stock Exchanges of the world, to cross-list a significant number of U.S. companies and get everybody to start to trade there?” he asked. “And then volume in the U.S. would drop even more, or maybe just stop. Maybe the U.S. equities are traded at exchanges overseas. And then the [transaction] tax generates a negligible amount of revenue because it shuts down the U.S. exchange industry.”

The bill won’t generate the anticipated revenues if trading behavior changes and volumes plummet, Hess added.

“You’re talking about imposing a tax on behavior that can change overnight and over time,” he said. “Algorithms will be changed. Trading patterns will be changed. People will seek to minimize the impact of this tax on them and that will result in less revenues, not to mention the additional costs it will impose on an already fragile system.”

Many of the half dozen in the industry pros interviewed for the story said the bill was too obviously flawed to pass. But each added that in an environment where the entire financial world is blamed for banks’ ills, and many are desperate to close budget gaps, no one is sure how seriously the bill will be taken.

“It’s better to be proactive on a poorly designed investor tax than it is to sit and wait for it to pop up on the mainstream radar,” said Peter Driscoll, current STA chairman, and senior equity trader at The Northern Trust Co.

Source: Traders Magazin by James Ramage 25.02.2009

Filed under: Exchanges, Trading Technology, , , , , , , , , , , ,

Chi-X seeks new business model for Asia

Founder Tony Mackay explains why the electronic trading network can’t easily tread the same path it forged in Europe.
Chi-X, the European-based electronic trading exchange, will succeed in getting established in the Asia-Pacific theatre only if it collaborates with local stock exchanges – the very entities that fear being displaced by its superior technology and anonymity.

Tony Mackay, who founded Chi-X as a spin-off from his former employer, Instinet, says there is no way the network will get off the ground in Asia if its business model is simply one of undercutting national stock exchanges’ pricing.

Mackay is now co-based in Hong Kong, where the network has opened an office. It also has people on the ground in Japan, Singapore and Australia. Chi-X has applied to be regulated as an exchange in Australia and is preparing to follow suit in Japan.

Unlike its original parent, Instinet, Chi-X is not keen to be regulated as a broker. Instinet continues to steadily divest shares to financial institutions, mainly broker/dealers, that trade high volumes on Chi-X. It sees itself more as a utility. (Chi-X’s ultimate parent is Nomura, which owns Instinet.)

In Europe, it went live in London in May 2007, where it adopted a more obviously competitive relationship on the back of its technological platform – but also thanks to European-wide regulation (Mifid) that scrapped restrictions on competitive trading platforms and clearing.

There is no Asian equivalent to Mifid, and across the region’s markets, any trades done on an alternative network would have to still be reported to the national exchange – which undermines Chi-X’s ability to match counterparts on an anonymous basis.

The region’s exchanges are nervous about letting in a competitor such as Chi-X. When it opened doors in London two years ago, it was capable of handling 30,000 trades per second – versus the London Stock Exchange’s mere 200. It has since won 15% market share – which in some stocks means as much as 40% of the market.

It has done so thanks to its adoption by statistical arbitrage traders – the likes of Citadel Group and DE Shaw, big hedge funds that execute literally tens of thousands of transactions across asset classes at any given moment. Market makers, investment banks’ prop desks and traditional buy-side investors participate on the other side.

There are a number of such players in Asia that would like to execute similar strategies here, but cannot because the market infrastructure wouldn’t support them. There are also many traditional money managers keen to see the high spreads in Asia come down, liquidity improve, and efficiency gains achieved.

Mackay realises that, without something like Mifid, there is nothing to compel national regulators to allow Chi-X to operate with a free hand. Chi-X has therefore established a new company, Chi-Tech, which is vending the same technology used by Chi-X.

Mackay notes that the LSE responded to Chi-X and other electronic networks (including Bats, Turquoise and Nasdaq) by spending around $100 million to improve its systems – a hefty commitment, and even then it wasn’t as fast. Chi-Tech is prepared to sell similar IT to Asian exchanges (which typically struggle to reach 100 trades per second) for $10-15 million.

“We want to make the market bigger and more efficient first. Then we can all grow,” Mackay says. “We’re not going to start a pricing war.”

In theory, if a number of Asian markets work with Chi-Tech, it can serve as the “glue” between them, allowing cross-border market-making and trading.

Chi-X is also hoping to help make clearing more efficient. Its competitive advantage in Europe was strengthened by working with a multilateral clearing facility run by Fortis, which charges only 10% of what European exchanges levy to settle trades – a savings that has attracted a lot of business from institutional money managers.

The credit crunch has set back its plans: Mackay was hopeful of winning approval in Australia last autumn, when Lehman Brothers collapsed. He doesn’t think the severe pressure on prop desks and hedge funds – many of which have closed – will stymie Chi-X’s opportunity, however. In particular, the diversified, short-term, market-neutral nature of statistical arbitrage means these strategies remain intact. Its practitioners are partnerships that are more disciplined about their own money than a typical investment bank prop desk.

Volumes in Europe are down as much as 50%, however, because activity among prop desks, traditional hedge funds and long-only managers has been sharply curtailed. “The whole market has become smaller for everyone,” Mackay says.

Source: Asian Investor, Jame DiBiasio, 13.01.2009

Filed under: Asia, Australia, Hong Kong, Japan, News, Singapore, Trading Technology, , , , , , , , , , , , ,

Global economic slowdown is not stopping Asia’s exchanges.

A  year ago, traders and technology vendors in Asia were riding a growing wave of liquidity and technology adoption. Direct market access (DMA), alternative trading systems (ATSes) and crossing networks steadily increased throughout the region as regulatory barriers began to fall away. While the financial crisis is putting a damper on the party, don’t expect opportunities in Asia to dry up, experts say.

“Asia is on a path of evolution that is going to converge eventually with the technology in the West,” says Neil Katkov, the Tokyo-based managing director of the Asia research group at Celent, a global financial market research and consultancy. With many traders and brokerages tightening their belts, adoption may slow, he says, but it will not disappear.

The opportunities are greatest for Asia’s exchanges themselves, which could take advantage of the slowdown to improve their own technology and compete with some of the trading networks that have been entering the region. “I think we’re going to see more of a realization from the exchanges that adopting modern technology is a competitive imperative,” Katkov says.

While algorithmic trading and order management systems (OMSes) have continued to grow in the region, the trends that attracted the most attention in 2008 were trading networks and DMA capabilities. Regulators in the region spent much of the year grappling with how to accommodate the dark pools, crossing networks and off-exchange trading platforms that were arriving and expanding.

These networks have been driven in part by an expansion of asset classes. A wide range of investors has been diversifying, adding new products into their portfolio. “Traditional buy-side firms such as pensions are starting to look into over-the-counter (OTC) derivatives, commodities and foreign exchange (FX),” Katkov says. “More products are being traded more frequently by more types of people.”

Local brokerages are also starting to make a difference, says Nevin Price, regional manager for Asia at Fidessa, a global trading systems, market data and connectivity solutions vendor. Aiming to compete with larger international firms, local brokerages are looking to adopt the newest technologies and gain access to new markets. As markets tighten, brokers want to keep costs down, and technologies that help to streamline trading and provide easy access to exchanges have been on the rise.

Many of these brokerages had their options expanded in the last year. Joining Liquidnet and ITG, which have been operating crossing networks in Asia since 2007, a new network entered the market.

BlocSec, an Asian electronic crossing network that opened in May and is owned by brokerage CLSA, now has 70 customers and operates in Hong Kong, Japan and Singapore. Liquidnet and ITG’s Posit network have also expanded their networks in the region. Still, with only a handful of players, there is ample room to grow.

“While dark pools have exploded in the US, they are still at their beginning stages in Asia,” says Ned Phillips, CEO of BlocSec. “I really think the more platforms the better in Asia, as it will grow the market but will not result in the fragmentation seen in the US.”

Crossing networks have an easier time entering Asia, as they don’t require a wholesale change in regulations, says Katkov. The arrival of DMA and the push of alternative trading networks, however, signal the loosening of some regulatory barriers in the region. “India has just allowed DMA this year and Australia is considering allowing off-exchange trading,”

While regulatory changes opened up markets in the past year, the financial crisis could prompt some exchanges to act defensively, blocking the incursion of off-exchange trading platforms and other networks that could cut into their liquidity.

Exchanges have taken defensive positions in the past, like  Australia as a recent example. While three off-exchange networks have applied to operate in the country, a call to review the regulations governing exchanges in the country has delayed the process for more than a year. Malaysia has also delayed allowing DMA on that country’s exchange.

Sang Lee, co-founder and managing director of Aite Group, an independent research and consultancy firms focusing on the financial services industry, says he believes the economic slowdown will help Asia’s exchanges view the competition in a new light. “Ironically, with all this mess happening the exchanges themselves are in great positions,” Lee says. “In the Asia market, real competition has not happened yet. All of the exchanges in Asia have the opportunity to become more innovative and more aggressive and competitive against some of these new smaller players.”

Many of the problems of the financial crisis appeared in the OTC market, Lee points out, which do not boast the transparency that traditional exchanges offer. “All indications are that we will see a heavier hand in terms of regulation in the coming year,” he says. “The global exchange market will have a lot of opportunities to take advantage of that.”

This is an opportunity that is unique to Asia. In Europe and the US, traditional exchanges are already losing significant amounts of liquidity to alternative trading venues. “For the European market it might be too late already,” says Sang. “But in Asia, exchanges have the chance to come out ahead.”

Exchanges in Asia could move to beat dark pools at their own game, offering their own alternative-type trading venues. Partnering with already-established networks in the West such as Chi-X could be another strategy Asian exchanges employ in the future.

“These are defensive moves, but not in a conservative way,” Katkov says. “Instead, they are trying to embrace new technologies and attract the most efficient services they can. I think that is the type of defensive move we’re more likely to see.”

Source: Waters Online, by Lauren Hilgers 06.01.2009

Filed under: Asia, Australia, Exchanges, News, Trading Technology, , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Asian Exchanges: Opportunities in Asia’s SouthEast Asian Markets

MALAYSIA-With the financial crisis expected to slow technology adoption throughout the Asia-Pacific region in the coming year, many are expecting some of Asia’s smaller exchanges to play a growing role in the market.

The Vietnam, Thailand and Malaysia exchanges, for example, lag behind some of their neighbors in terms of trading technology. These markets lack some of the basics, and technology vendors in the region will benefit as they fill in the gaps.

Malaysia introduced a new trading platform in early December aimed at improving latency and allowing traders to access the exchange electronically. “As the Malaysian marketplace progresses, we must leverage new technologies to allow market users and investors access to more trading opportunities,” says Dato’ Yusli Mohamed Yusoff, CEO of the Bursa Malaysia Berhad. As the exchange goes, local brokerages will likely follow suit, adopting new technologies to stay competitive.

Traders and technology vendors also have their eyes on Vietnam and Thailand. GL Trade is planning on adding Thailand to its own DMA platform in 2009, going through local brokerage Seamico Securities Public Company Ltd.

Vietnam operates with an electronic matching system, but traders are still waiting for the exchange to improve its communication with brokerages. Other small exchanges are expected to come on the scene in 2009, including the Cambodian Stock Exchange, a joint venture between the Korea Exchange and the Cambodian government. The exchange may be small, but for technology vendors, the new markets will help keep sales up in tough times.

Source: Watersonline by Lauren Hilgers, 06.01.2009

Filed under: Exchanges, Indonesia, Malaysia, News, Singapore, Thailand, Trading Technology, Vietnam, , , , , , , , , , , , ,

Pan-European Platforms Form Symbology Working Group

Chi-X Europe, Nasdaq OMX Europe and BATS European Markets Division have formed a working group to create a uniform symbology for European equities. The three companies said today that the initiative will allow market data to be more easily consolidated across trading venues and facilitate smart-order routing.

“A common symbology will ease navigation between market centers and ultimately provide a better experience to investors,” said Todd Golub, head of markets development at Nasdaq OMX Europe, in a statement. “This move will also reduce the back-office complexities” related to the European Union’s Markets in Financial Instruments Directive (MiFID), which went into effect about a year ago. Nasdaq OMX Group’s multilateral trading facility (MTF) began limited operations Sept. 26.

“Customers will now only need to manage one common list” of symbols, Golub added in an interview. “It will also drive down the cost of trading in Europe and help liquidity move from the primary exchanges.” Participation in the effort is open to all European venues–both exchanges and MTFs–said the companies.

Source: Securities Industry News, 22.10.08

Filed under: Data Management, Exchanges, Market Data, News, Reference Data, Standards, , , , , , , , , , , ,