NYFIX Millennium, an operator of non-displayed execution facilities, has announced the controlled release of Millennium PLUS, a new feature of Millennium that aggregates disparate liquidity sources from throughout the securities industry. The new feature allows Millennium participants to generate anonymous liquidity alerts to external dark pools and other passive liquidity sources, increasing execution opportunities for both Resident and Pass-Through Millennium PLUS orders. Millennium PLUS is currently being offered to a select group of clients and liquidity partners, with general availability expected in Q3 2007.
Millennium PLUS offers the benefit of allowing orders to interact with a broad universe of liquidity while preventing information leakage and minimising market impact, the firm says. The select group of early adopters have increased their match rates within Millennium by as much as 100%.
“With the ever-increasing amount of liquidity fragmentation in today’s financial markets, it has become more and more difficult for market participants to effectively source the best opportunities for execution,” comments Brian Carr, CEO, NYFIX Millennium. “By introducing Millennium PLUS, we are providing an efficient way to defragment and reaggregate disparate liquidity. Along with our recently released liquidity sourcing algorithms, Millennium PLUS will be a key component of our liquidity aggregation strategy in the future.”
A Millennium PLUS order allows participants to generate liquidity alerts to third-party sources known as passive liquidity partners (PLPs). These liquidity partners include systematic buy-side funds, external dark pools, broker internalisation engines, and other pockets of hidden liquidity from across the industry. Millennium PLUS liquidity alerts are delivered only to computer-based systems holding live orders, rather than to traders’ screens. As a result, liquidity alerts will not be visible to traders or systems which may cause information leakage or market impact. Both Resident and Pass-through orders can be designated as PLUS Orders. Pass-through PLUS Orders are held in Millennium for several hundred milliseconds, just long enough for PLPs to receive the liquidity alert and automatically respond, NYFIX Millennium says.
“The ability to aggregate dark pools is of absolute value with the significant amount of the fragmented and hidden liquidity in today’s market,” comments Larry Tabb, co-founder and CEO, TABB Group, a leading research and advisory firm to the financial markets. “With the proper tools, market participants will be able to much more effectively navigate the murky world of dark liquidity while minimising information leakage, managing market impact and attaining the best execution possible.”