There has been a lot of debate around the role of SEFs in the global derivatives market. Some commentators are even claiming that the whole concept is dead and buried before the rules have even been finalised. But debating the viability or otherwise of SEFs is completely missing the point. The right question is how will standardised and custom derivatives contracts trade and clear in a post Dodd-Frank/EMIR world? What these regulations are doing is removing an artificial barrier that has...

Welcome to the second issue of our European Dark Trading Analysis. In this report we provide a comparative performance analysis for the major European dark pools, together with a useful at-a-glance summary of the regulatory framework across the globe. Thanks to everyone for their suggestions so far and please keep them coming – just email the team. Download your copy here.

Interesting last week to see that GFI has applied to the CFTC to become a futures exchange. This follows on from ICAP’s purchase of Plus Markets (now ISDX) and so it surely can’t be too long before the other IDBs follow suit and execute their own regulatory hedges too. What they are worried about is that the regulatory regime around swaps seems to favour futurisation rather than SEFs and so will hand the keys to the kingdom over to the likes of the CME, ICE and other derivatives exchanges. This...

 
This article was originally published at the Fidessa Fragmentation blog, and is reproduced here with permission.
 
By Steve Grob
I read a number of reports this week trying to kill off the idea of the great rotation back into equities. This prompted me to take another look at Fidessa’s spangly new ‘HFT-free’ trading index. At first glance it seems to confirm the view that both institutional and retail volumes fell off badly in Europe.

But, er, hang on a...

I got a bit of stick for a recent post where I wrote about the apparent move back into equities trading in January. To be fair, I was only referencing other people’s work but, nevertheless, I was anxiously awaiting the numbers for February. The good news is that volumes in Europe seem to have held up pretty well. Just as before though, I asked the boffins to strip out the HFT ‘noise’ and just focus on the ‘real’ institutional flow executed by Fidessa’s sell-side...

 
This article was originally published at the Fidessa Fragmentation blog, and is reproduced here with permission.
 
By Steve Grob
The debate about Financial Transaction Taxes (FTTs) seems to roll on and on. Italy’s FTT is due to come into force this Friday and two democrats in the US want to introduce an American FTT. Even EU Tax Commissioner Algirdas Semeta says a global tax on financial transactions eventually should be a reality.
All of this got me thinking about...

 
This article was originally published at the Fidessa Fragmentation blog, and is reproduced here with permission.
 
By Steve Grob
Been reading quite a bit lately about how good old-fashioned equities are finding their way back into investors’ favour. And this time it is more than just the indices that are on the move, volume traded is going up too. In many ways, volume or consideration is a more useful indicator of the general health of the trading industry and the US...

 
It’s always seemed like the wrangling over regulation in Europe’s capital markets was, in many ways, a proxy for the broader political debate raging across the region. No surprise, then, that on the eve of today’s speech by David Cameron we saw that the European finance ministers have agreed the creation of a vanguard transaction tax bloc that will implement its own Tobin-style financial transaction tax across 11 countries, including France, Germany, Italy and Spain...

 
This article was originally published at the Fidessa Fragmentation blog, and is reproduced here with the author's permission.

By Steve Grob

In cosmology, dark matter is a type of matter that the boffins reckon accounts for a large part of the total mass of the universe. It cannot be seen and neither emits nor absorbs light. And yet it is estimated to account for over 80% of the total universe – so, pretty important then.
In European equities trading the rise of...

This article was originally published at the Fidessa Fragmentation blog, and is reproduced here with the author's permission.

By Steve Grob
Just when I was hoping to start thinking about the Christmas holidays (beginning with the first of the season’s parties this week) we’ve seen a bunch of announcements on the European consolidated tape, including those from FPL and The COBA Project.
Everyone acknowledges that the lack of an agreed tape of record makes any concept of...