In a move to lure more US retail investors to its trading platform, Bats Trading - the all-electronic alternative to Nasdaq OMX and Nyse Euronext - has struck a deal to provide its real-time US stock quotes free of charge to users of Yahoo! Finance.
In a statement Bats says its real-time US stock quotes are now available to 19 million users of the Yahoo! Finance site.
The data will initially appear on Yahoo! Finance's quote summary pages, before being integrated into additional areas of the site in coming weeks.
The Bats ECN - which is designed to handle high-speed, high-volume and anonymous algorithmic trading for broker-dealers - launched in the US in January 2006 and now claims a 8-10% market share in US equities. An aggressive one month pricing plan was introduced in January 2007, helping to drive trade volumes and forced both Nasdaq and Nyse to adjust their fees.
The ECN is now looking to boost its market share even further by targeting the fees that stock exchanges charge for market data. It is thought that both Nyse Euronext and Nasdaq OMX generates well over 10% of their revenue from market data fees.
Joe Ratterman, Bats chief executive, says the company has pushed for free market data for market participants ever since Bats was launched.
"Over time, with continued pressure from competitive market centres such as Bat, we believe that market data fees will decrease or be eliminated altogether," he adds.
Bats filed an application with the US Securities and Exchange Commission (SEC) to become a fully licensed securities exchange in November 2007 and recently completed the formal public comment period. In today's statement, exchange says it is "hopeful" that approval will be granted and it can begin operations as a national securities exchange in 2008.
The Kansas City-based market operator is also gearing up to launch its platform in Europe later this year to compete with the region's stock exchanges.