Equiduct CEO Peter Randall has said he aims to attract institutional trading activity to the trading venue as soon as a solid base of retail flow has been established.
Trading on Equiduct ramped up at the end of last year largely due to the influence of Citadel Securities, the market-making and trade execution division of Citadel Investment Group, which took a majority stake in the firm in July last year, just four months after its launch.
According to figures from data vendor Thomson Reuters, turnover on Equiduct, which is registered as a recognised investment exchange under MiFID, increased to €26.03 million in December 2009 from €177,583 in November. It has sustained its volumes into the New Year, trading €25.29 million in January.
“We have added substantial new participants to the platform over the last few months, which has been supplemented with the support of Citadel and our other shareholders,” Randall told theTRADEnews.com. “Aggressive market makers on any trading venue will drive business, but Citadel’s involvement has also increased the credibility of the platform.”
Randall, who joined Equiduct last December after two years at the helm of Chi-X Europe, the largest multilateral trading facility, believes there is a gap yet to be filled by alternative venues in Europe.
“The benefits of MiFID have been felt in an uneven way. While the wholesale market has enjoyed lower costs and better prices, the same has not held true for the retail community. Our strategy is to redress that balance,” said Randall. “Mixing retail and wholesale flow is the basis of all markets, but this is a niche that has yet to be exploited by existing multilateral trading facilities.”
The European Commission’s review of MiFID, which is due to take place this year, is largely expected to focus on issues affecting the institutional community such as data transparency and consolidation, and dark pools. Randall however, urges that more should be done to enforce best execution policies, where both buy- and sell-side firms are required to detail how they plan to achieve the best possible trading outcome for their clients.
Some market participants have complained that since MiFID was introduced in November 2007, regulators have done little to ensure financial institutions stick to their best execution policies.
“Brokers that serve the retail community should be made to demonstrate their best execution obligations, which will undoubtedly result in a positive change for retail investors,” said Randall.