Two pan-European multilateral trading facilities (MTFs), NYSE Arca Europe and Turquoise, have announced plans to start trading US-listed securities during European trading hours. US trades on NYSE Arca Europe and Turquoise will be cleared through pan-European clearing house EuroCCP, an incumbent post-trade provider for both platforms.
Turquoise, a subsidiary of the London Stock Exchange, aims to start trading 175 of the most liquid US equities, American depository receipts (ADRs) and exchange-traded funds (ETFs) from 23 April. The list of ETFs includes ‘long’ and ‘short’ securities based on the S&P 500 and Nasdaq-100 indices, S&P industry groups and MSCI country and regional indices. The equities include household names such as Citigroup, Apple and Alcoa, and the ADRs include large European names such as BP and Vodafone.
Trading US-listed securities on Turquoise will be free for the first three months, with a maker-taker pricing structure taking effect thereafter.
“Trading US securities on Turquoise during European market hours will create new trading opportunities for market makers, spread betting firms, proprietary trading firms and arbitrageurs, and will build a pool of liquidity that institutional brokers can leverage for the benefit of their customers,” said Turquoise CEO David Lester in a statement.
NYSE Arca Europe, the pan-European venue owned by global exchange group NYSE Euronext, will make constituents of the S&P 100 index available for trading on its platform at an unspecified date in Q2. The MTF said further stocks are likely to be introduced in the near future.
“Our clients have shown a strong interest in being able to trade US stocks through NYSE Arca Europe, seeing this as a good business opportunity,” said Virginie Saade, head of NYSE Arca Europe. “As part of NYSE Euronext, we have been able to leverage the group’s knowledge and experience of the US market, as well as our relationship with EuroCCP, to help unlock the US stocks for our European clients for the first time, at low cost.
EuroCCP will clear trades for both trading venues and settle through its account at US central securities depository DTC which, like EuroCCP, is owned by US post-trade provider The Depository Trust & Clearing Corporation.
EuroCCP CEO Diana Chan told theTRADEnews.com last week that the clearing house had plans to introduce a CCP service for US stocks traded in Europe. “The transatlantic dimension is very exciting,” said Chan.
Turquoise, which launched in September 2008 and trades in 19 European countries, had a market share of 2.61% of pan-European trading turnover in March, according to figures from data vendor Thomson Reuters.
NYSE Arca Europe, which launched in March 2009 and trades in 11 countries (it excludes the four Euronext markets of France, Belgium, the Netherlands and Portugal from its coverage) had a pan-European market share of 0.33%.