Goldman Sachs outsources dark pool operations to NASDAQ

NASDAQ to oversee Goldman Sachs’ day-to-day dark pool operations.

Goldman Sachs has outsourced operations of its dark pool to NASDAQ, according to reports.

The investment bank will also deploy NASDAQ’s technology and surveillance tools on its Sigma X trading system, in an agreement that is subject to regulatory approval.

The partnership is thought to be in response to increasing regulatory pressures and mounting costs following severe fines for violations of dark pool operations.

NASDAQ and Goldman Sachs could not be reached at the time of publication for comment.

Earlier this week, SIX Swiss Exchange extended its contract with NASDAQ, which will see its equities dark pool - SwissAtMid - powered by NASDAQ's trading and surveillance technology.

The contract extension marks 10 years of partnership between the two firms.

In 2014, Goldman Sachs was fined $800,000 for malfunctions in Sigma X that saw 400,000 mispriced trades take place during an eight-day period three years prior.

Goldman Sachs did not admit or deny the allegations and gave its clients compensation amounting to $1.67 million.

Its third quarter earnings report revealed a strong quarterly performance with revenues surging 47% compared to the same period last year.

Goldman Sachs said the increase was "due to significantly higher net revenues in interest rate products and credit products, as well as higher net revenues in mortgages."