Macquarie Securities is opening a new Hong Kong dark pool this month.
After receiving its Type 7 license in July from Hong Kong’s regulator, the Securities and Futures Commission (SFC), Macquarie ran a pilot scheme with a select handful of accounts and is now offering the product to a wider range of clients.
The dark pool has been christened ‘MaX’, a diminutive of the term ‘Macquarie Crossing’.
The pool will prioritise agency-to-agency crossing. Within existing Hong Kong dark pools such a prioritisation had not been a requirement. In general, only professional investors bearing the SFC’s ‘Type A’ category are allowed to participate in ‘MaX’.
In addition, clients need to provide documented permission before their trades are allowed entry into ‘MaX’. In the past, trades might be placed into a dark pool simply under standard best execution arrangements.
It remains to be seen if the dark pools that have already been in operation in Hong Kong will need to adjust to the terms that have been applied uniformly to the new licensees and also to what extent the planned SFC consultation on the subject of dark pools may further impact the industry later this year.