Revenues from 'low-touch' electronic trading across the European equity markets will rise from EUR1.8 billion in 2008 to nearly EUR2.1 billion by 2010, says Tabb. But the growing use of automated trading "does not spell doom for the sales trader" and although their role has changed over the past ten years, sales traders will not disappear.

Although use of sales traders across European market centres will continue to decline at a rate of nine per cent over the next two years, the buy side will continue to execute 50% of order flow through sales traders by 2010, down from 82% in 2005.

Kevin McPartland, senior analyst at Tabb Group, says high-touch services will remain critical in the increasingly complex and fragmented post-MiFID market. Stringent best-execution requirements and volatile markets will also make sell-side brokers increasingly important to the buy-side trader.

"Even for electronic-trading clients, the expertise provided by the sell-side broker remains invaluable in navigating the markets and the complexities that surround them," he adds. "The buy side looks to their broker to provide clarity to the situation."

McPartland says the "sell-side value proposition" can come in different packages - such as through sales trader-provided colour or liquidity-seeking algorithms, but these are not mutually exclusive.

Earlier this month Instinet Europe said smart-order routing technology is vita to success for agency brokers operating in the fragmented post-MiFID market.

Richard Balarkas, CEO of Instinet Europe, said the introduction of MiFID had not resulted in any "evident deterioration in liquidity opportunities, price formation or execution performance" and by using smart-routing technology Instinet has been able to exploit significant pricing opportunities on behalf of clients.