Buy-side split on MiFID II liquidity impact

New survey reveals buy-side is evenly split on whether to increase, reduce or sustain the number of liquidity venues they connect to.

The buy-side is evenly split in their approaches to increasing, reducing and sustaining the number of liquidity providers they work with as a result of MiFID II, according to a survey.

A survey conducted by Worldwide Business Research and Ullink found 35% of buy-siders expect to connect to more liquidity venues due to MiFID II, while 32% expect to connect to less and 33% expect no change.

The research explained there are certain prominent liquidity providers becoming well known and respected in the market the buy side are looking to work with.

“However, given progressive fragmentation in the market, there are concerns over which providers are actually adding liquidity and value.”

Commenting on the results of the survey, Chris Jackson, Liquidnet’s head of execution and quantitative services in EMEA, explained it reveals buy-side uncertainty.

“This survey result points to the uncertainty that pervades the market at the moment, with regard to the number, structure and quality of liquidity venues that will have to evolve as MiFID II comes into force,” he said.

Jackson added: “Clients tell us that navigating this new landscape is one of the key challenges they will have in delivering best execution.”