Deutsche Börse is currently in the process of developing a midpoint trading functionality, with an envisaged launch of November 2024, The TRADE understands.
Known as ‘Xetra Midpoint’, the functionality is a customer-driven project according to Deutsche Börse and will be integrated into the Xetra market.
Speaking about the development, Maximilian Trossbach, project manager for Xetra Midpoint, said: “[…] Large member firms asked us to deliver a midpoint service as an integrated solution in the heart of price discovery for German instruments. We can offer full synchronicity of midpoint prices for these instruments, as the midpoint orderbook and the Xetra Central Limit Orderbook will be hosted in the same location.”
Read more: Deutsche Börse launches Xetra market close mechanism
According to Deutsche Börse, traders will be able to choose between midpoint orders to trade in the midpoint book only. In addition, they will be able to sweep orders which enter the midpoint book first – any remaining quantity is automatically entered into the Xetra Central Limit Orderbook.
“Sweep orders offer a chance for a price improvement against the BBO in the CLOB, and will have no latency disadvantage compared to orders that go directly into the CLOB,” said Trossbach.
Dark trading is continuing to grow across Europe, with a swathe of venues making moves in the space in recent times as both regulators and market participants across asset-classes increasingly bank on the strategy.
Read more: Trading in dark pools and periodic auctions lowers execution costs, FCA paper concludes
More to follow…