TORA, Asia's leading provider of advanced trading technology and financial services, extends its next generation smart order routing (SOR) algorithm, TSOR™, to Hong Kong as it sees increasing market fragmentation as a key challenge for buy-side traders in achieving best execution.
Beyond finding liquidity across multiple off-exchange venues, TSOR™ incorporates advanced performance-focused features and customization options that can be based on client-specific trading parameters and strategies. "The buy-side trader welcomes tools like TSOR™ which provide efficiencies in finding liquidity and help to execute orders at their target price, or better, as liquidity fragments across Asia," says Chris Jenkins, Managing Director at TORA. "The more alternative venues an SOR reaches to, the more alternative liquidity the client can access. TORA's unique position as an independent provider makes it attractive for brokers to use TSOR™, which now has the broadest number of broker destinations in the market."
SORs are becoming more sophisticated as clients look for opportunities to gain a price advantage, seek liquidity and prevent information leakage, according to TORA. Underlying TSOR™ is a proprietary algorithm which anonymously and simultaneously searches multiple broker internalization pools with a broad set of flexible parameters to intelligently create any type of rule which helps achieve best execution.
Toxicity-based rules that preference flow to specific pools and posts certain types of orders to pools where that order is most likely to benefit are one example. Traders can also set thresholds for crossing at a minimum order size or level of price improvement, or overlay algorithmic strategies which support their optimization strategy. Jenkins adds "Clients who trade Hong Kong will certainly see benefit in adopting TSOR™ into their workflow as a tool to source liquidity from a single point of access, whether it is via TORA Compass™ or any execution management system. We expect scale to build quickly as it has in Japan, where TSOR™ delivers clients an average price improvement of 11 basis points."