A multitude of new trading venues launching in the derivatives markets are challenging trading systems designed to deal with specific markets, finds Dan Barnes.
Competition between derivatives trading venues has
historically been rare. Since Eurex stole the bund from Liffe
in the late 90s there has not been a major liquidity shift from
one market to another. This may change.
Challengers to the well-established markets for
exchange-traded products are launching, while new markets for
over-the-counter products threaten a tug-of-war with
established players. To offer access to these competitive
venues, vendors must offer connectivity and order routing
systems or aggregators that allow clients to choose where to
Carl Slesser, chief technology officer at NLX, said: "From
the perspective of screen real estate for a trader, it is
challenging to have two parallel markets and a number of
products on one screen.
"Where aggregating technology helps is that it enables them
to not have to have a large number of ladders to cover the
whole of the Euribor expiries for instance. You can just have
the standard 20, then have rules on best execution around
price, and have rules on percentage flow."
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