Aquis Exchange to launch closing order type (MaC)
April 13, 2015
Aquis Exchange, the subscription-based European equities exchange*, will introduce a new order type – Market at Close (MaC) – that allows its Members to enter orders for matching on the Aquis Exchange platform at the closing price of the market-of-listing end-of-day auction. This initiative is supported by a number of key asset management and brokerage firms.
MaC meets pre- and post-trade transparency requirements and, crucially, will not be subject to MiFID II restrictions for the use of reference price waivers. MaC has received approval from the UK’s Financial Conduct Authority. It will be offered at no additional cost to Aquis Exchange Members that are top-tier subscribers.
The new initiative is supported by a range of large buy-side institutions including Legal and General Investment Management. Early sell-side adopters include Instinet and Société Générale.
Currently, about 20% of all trading in Europe is conducted in closing auctions – approximately €1.2 trillion annually. Fees charged at the auction are typically 50-100% higher at this point in the day than at any other time as a result of the lack of competition, making the closing auctions a particularly lucrative segment of the market for exchanges.
Commenting on the announcement, Alasdair Haynes, CEO of Aquis Exchange, said:
“This is a major development for the market. While MiFID I paved the way for new venues to compete against the trading monopolies held by national exchanges, the closing auctions had remained virtually unchallenged. Through the highly sophisticated, but simple-to-use, technology of MaC, Aquis Exchange has for the first time opened the closing auctions up to competition. This is another innovation from Aquis Exchange that will improve the marketplace as a whole and yield major cost savings for our Members.”
“Société Générale encourages market innovation that benefits its clients. We are fully supportive of the Aquis initiative and will follow its development with great interest,” said Richard Hills, Global Head, PT and Electronic Trading at SGCIB.
For further information, please contact Belinda Keheyan on +44 203 597 6329/07768 078110 or firstname.lastname@example.org
About Aquis Exchange
*Aquis Exchange is authorised and regulated by the UK Financial Conduct Authority to operate a Multilateral Trading Facility. It was established in October 2012, launched in November 2013, and operates a pan-European cash equities trading exchange and develops exchange software. Aquis Exchange is changing the European trading landscape through its introduction of subscription pricing and innovative order types. Currently, over 90% of European equity trading in each individual country takes place on two exchanges. The aim of Aquis Exchange is to bring fresh competition into the marketplace in order to lower the trading costs maintained by the existing duopoly.
Aquis Exchange’s subscription pricing works on a similar model to that of the telecoms industry and is designed to encourage participation from all categories of professional trading firm. Users are charged according to the message traffic they generate, rather than a percentage of the value of each stock that they trade. There are different pricing bands to accommodate varying degrees of usage, with a very low usage band for small firms – who are traditionally disadvantaged by the pricing structure of the incumbent exchanges. At the other end of the pricing structure, is the top category where usage is unlimited (subject to a “fair usage” policy). For more information, please go to www.aquis.eu.