US boutique broker Capstone Global Markets (CGM) has become the first user of the new equity options functionality on trading technology provider Fidessa’s US hosted trading platform.
The work to integrate equity options trading functionality into the platform was completed in August. The new features will allow CGM, which specialises in volatility trading strategies, to manage its equities and options positions on a single platform. According to Fidessa, this minimises the cost and risk of maintaining multiple systems.
The platform also allows small- and mid-tier brokers to provide electronic trading facilities to their buy-side clients. In addition to trading capabilities, the Fidessa solution includes integrated market data and connectivity to 120 trading venues, including all seven US options exchanges, 2,300 buy-side firms and 400 brokers worldwide.
CGM will also use BlueBox, Fidessa’s algorithmic trading engine, which allows users to trade algorithmically using their own exchange memberships.
CGM chose the Fidessa platform to improve service to its client base, which mostly comprises hedge funds but also includes mutual funds and investment advisors. “It allows us to compete with every other investment bank in terms of client service and connectivity,” Tim Freeman, head of US equity derivative sales at CGM, told theTRADEnews.com. “Fidessa is a widely used and accepted platform that allows us to route to and service clients globally in an effective and efficient manner.”
“The sell-side are seeing growing demand from their buy-side customers to trade complex multi-legged option and option-with-stock orders,” added David Polen, senior vice-president of hosted product marketing at Fidessa. “Our brokers are leveraging Fidessa technology to offer the buy-side comprehensive trading.”
In addition to FIX connectivity, emailed order reports and integration with execution management systems, a further benefit of the Fidessa platform to its customers’ buy-side clients is its back-office interface, according to Polen. “Brokers are able to ensure that the often complex clearing requirements of the buy-side are met and allows for trades to be divided across multiple clearing brokers,” he said.
A number of other sell-side firms are beta-testing the new US platform, and Fidessa will announce additional information about the new clients in the coming months.
Fidessa plans to include support for US equity options in its Canadian trading platform in 2010. Integrated options futures and equity trading has been available on Fidessa’s European and Asian trading platforms for a number of years, said Polen, but the new functionality allows European and Asian brokers to offer their clients trading in US equity options from their existing platforms.