The Gateway to Algorithmic and Automated Trading

Viewpoint: Miranda Mizen, TABB Group

Published in Automated Trader Magazine Issue 13 Q2 2009

“When it comes to dark liquidity, there is much at stake. TABB Group estimates that the European equity volume traded in crossing networks (MTFs) and broker dark pools will increase from 3% in 2008 to 11% in 2010 as more buy-side traders connect, liquidity seeking algorithms and matching logic is improved, and agency trading takes over the baton from risk capital. While lit venues can add dark orders and functions, these are the venues with the widest participation and therefore the least trust.”

"Trading in dark pools - whether MTFs, systematic internalisers or unclassified - offers an alternative execution method to a buy side struggling against information leakage and market impact as well as contending with a new market structure, reduced volume, post-trade visibility and an economic crisis. … The difficulties surrounding dark liquidity are exacerbated for the regulator by the mix-and-match classifications by brokers, who have interpreted the regulations in accordance

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