18 February 2018
visit www.ebaday.com

Nyse Euronext teams with Bids for block trading JV

30 October 2007  |  5595 views  |  0 globe swirly

Exchange operator Nyse Euronext is establishing a block trading joint venture with Bids Holdings, the Wall Street consortium that is setting up its own alternative platform for equity block stock trading.

The 50:50 JV will operate as operate as a facility of Nyse but will be accessible through Bids Trading platform.

In addition, the exchange says it will make an undisclosed investment in Bids Holdings.

Nyse Euronext says the venture will improve execution quality and access to liquidity in block trading.

Is a statement Duncan Niederauer, president and co-chief operating officer of Nyse Euronext, says: "We believe that this innovative co-branded approach with Bids Holdings will serve our clients and markets well by bringing block-size orders back into contact with active traders, algorithms, and retail flow."

Niederauer told Wall Street Journal (WSJ) reporters institutional investors have called on the exchange to make it be easier to trade large blocks. He said it was "the single biggest thing we hear from our customers".

The rapid take-up of e-trading in recent years, as well as the use of algorithmic trading methods, has resulted in a major decline in block trading activity at the exchange. According to a WSJ report, since January 2004 monthly activity in block trading at Nyse has declined 78%, from 494,600 trades to 107,800 trades last month.

But big block trades are profitable for exchanges like Nyse because they generate trading fees without using up the technology resources that thousands of small trades do, says the report.

Last year six investment banks - Citigroup, Goldman Sachs, Lehman Brothers, Merrill Lynch, Morgan Stanley and UBS - set up the Block Interest Discovery Service (Bids) to enable users to anonymously execute block trades. A further six banks joined the initiative in March this year.

Tim Mahoney, CEO of Bids Trading, says the joint venture with Nyse Euronext will address the current inefficiencies in block trading, such as market fragmentation.

"Moreover, this initiative is an endorsement of our efforts to build the leading block interest discovery and trading system in the US," he adds.

The formation of the JV is subject to approval by the US Securities and Exchange Commission and certain corporate authorisations.

Last week Nyse Euronext said it was teaming with investment banks HSBC and BNP Paribas to establish an electronic block trading platform for European-listed stocks, called Project SmartPool.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

OMX to host Bids ATS

OMX to host Bids ATS

14 March 2007  |  4361 views  |  0 comments
Six more Wall Street banks invest in Bids

Six more Wall Street banks invest in Bids

01 March 2007  |  8166 views  |  0 comments
Wall Street consortium launches alternative system for block trades

Wall Street consortium launches alternative system for block trades

27 September 2006  |  9442 views  |  0 comments

Related company news


Related blogs

Create a blog about this story (membership required)
visit www.ebaday.comvisit www.swift.com/your-needs/instant-paymentsvisit http://info.nice.com

Who is commenting?

Top topics

Most viewed Most shared
Saudi central bank provides sandbox for banks to try out Ripple techSaudi central bank provides sandbox for ba...
10469 views comments | 16 tweets | 11 linkedin
Aussie real-time payments platform goes liveAussie real-time payments platform goes li...
8257 views comments | 15 tweets | 41 linkedin
ECB launches staunch defence of cashECB launches staunch defence of cash
7745 views 10 comments | 21 tweets | 26 linkedin
hands typing furiouslyHow can Blockchain Help with AML KYC
7618 views 3 | 9 tweets | 4 linkedin