Liquidnet, a crossing network, has entered a liquidity-sharing arrangement with US trading platform BATS Trading. Under the arrangement, BATS has become a ‘streaming liquidity partner’ for Liquidnet’s H2O crossing pool. This will allow Liquidnet’s nearly 500 members to access the 700 million shares traded on BATS per day, via Liquidnet H2O.
Firms that trade on BATS can use its new Dark Scan order type to cross with Liquidnet H2O flow. The arrangement means BATS has become Liquidnet H2O’s 22nd streaming liquidity partner. Other partners include brokers, exchanges and electronic communications networks. The H20 pool includes flow from non-buy-side sources, while access to Liquidnet’s core crossing network is restricted to institutional investors.
“Liquidnet’s membership represents some of the biggest institutions in the world and we are glad to add them to our dark liquidity partner programme,” said BATS CEO Joe Ratterman in a statement. “Our ability to interact with Liquidnet H2O and other partners helps to ensure that our customers’ orders are filled efficiently. As we approach exchange status in the US, we look forward to growing in this and other areas.”
On June 2, BATS implemented a new pricing structure for dark orders, based on execution size. The firm said the new pricing is designed to encourage larger trade sizes against dark liquidity on the BATS book.