Société Générale Corporate and Investment Banking’s direct capital access offering now includes electronic order facilitation of exchange-traded funds (ETFs).
Direct capital access on ETF (ETF DCA) lets institutional investors send orders electronically for instant access to liquidity that is not generally available on exchanges.
Société Générale said the new service overcomes liquidity and regulatory challenges by combining agency algorithms with capital provision, where broker makes a price for the client. ETF DCA provides direct electronic access to 44 global exchanges, including all developed European primary exchanges and the four largest MTFs, Asian and American exchanges, emerging markets and ETF instruments.
According to the bank, relatively illiquid ETFs can be accessible via the service, with Société Générale’s One Delta team managing the hedge using a wrapper or related underlying. At launch, the product covers over 30 index and sector ETFs from Société Générale’s ETF provider Lyxor and others.
“On the agency side, this is still a fairly voice-based business, with clients generally calling several brokers on pricing,” said Mark Goodman, head of Quantitative Electronic Services at Société Générale Corporate and Investment Banking. “Direct Capital Access on ETF increases the automation in this space, particularly for sizes which are not available on the exchange but where the client is executing a regular hedge or managing inflows/outflows and the phone is not convenient.”