Trading technology provider Charles River Development has added UBS Perimeter, an equities execution algorithm designed for trading on US venues outside regular market hours, to its Investment Management System (IMS).
Perimeter, developed by Swiss banking group UBS, enables clients to trade algorithmically in the open, pre-open and close of US exchanges. UBS launched the algorithm in April to users of PinPoint, its proprietary execution management system, and third-party providers are now adding it to their trading systems.
“Perimeter allows users to control their participation in out-of-hours trading by controlling the urgency of the order,” Owain Self, head of algorithmic trading for the Americas and EMEA at UBS,” told theTRADEnews.com. “They are able to use the same order-placement logic we have in all our algorithms for these specific situations.”
Clients may want to use algorithms to trade in these periods, said Self, because of the fast reaction times needed to capitalise on opportunities such as order imbalances on the opening and closing call auctions, where there is a glut of either buy or sell orders lacking the corresponding opposite side.
“Trading out-of-hours is purely about efficiency and not having to watch all the markets at the same time,” said Self. “The algorithm has the sophistication to take in all the market data and react very quickly. With regards to the order imbalances in the calls, there isn’t a very large window for people to react and trade into these. An algorithm allows clients to send an order straight away without having to worry about whether they have used the right order type in the direct market access system or set the right limit.”
UBS is one of over 40 brokers providing algorithms to the Charles River IMS. The system offers users access to more than 500 algorithmic strategies. Charles river clients can customise vendor-supplied algorithms in real-time and execute multiple strategies simultaneously using the IMS.