New York-based Investment Technology Group (ITG) is establishing an off-exchange automated equities trading platform in Europe.
ITG's Posit Now platform is a continuous intraday crossing system for equities that will provide users with access to liquidity that is not displayed on order books.
The system's total anonymity ensure that there is no leakage of information into the market and therefore price impact is minimised, says ITG. Orders are also crossed at the midpoint price of the underlying market, offering a 50% saving on the bid/offer spread.
ITG already operates its Posit Match crossing system in Europe, which offers users a concentrated pool of liquidity in which to match buy and sell orders.
Alasdair Haynes, CEO of ITG in Europe, says the new Posit Now platform is a natural extension of the crossing business and has been launched expressly in response to client demand.
"Our clients know that crossing gives them valuable access to liquidity and helps them reduce transaction cost. In other words they maximise their opportunities to execute business while at the same time minimising risk," he adds.
Haynes says the Posit Now platform will benefit from the implementation of MiFID and its requirement for market participants to investigate all sources of liquidity to ensure best execution.
Private off-exchange crossing networks are already well-established in the US markets. Recent analysis by the Tabb Group suggests that such 'dark liquidity' pools now account for some 10% of all US equity dealing volume.