The global equities arm of investment bank UBS has launched direct market access (DMA) for international clients trading securities on BOVESPA, the Sao Paolo-based stock exchange.
UBS is among the first broker-dealers to offer international clients DMA in the Brazilian market. Earlier this year, BOVESPA merged with BM&F, the Brazilian commodities and futures exchange, making it the third largest stock exchange in the world.
“The move takes advantage of recent regulatory changes. Credit must go to the CVM (Comissão de Valores Mobiliários, the Securities and Exchange Commission of Brazil) for recognising the benefits of making it easier for foreign investors to access the Brazilian market,” Joel Beck, head of international sales trading and trading, UBS, told theTRADEnews.com.
According to UBS, DMA will allow clients to send electronic orders to the exchange quickly and efficiently, without the use of an intermediary, therefore providing faster execution, lower costs of trading and greater transparency.
Beck also believes that DMA should result in fewer inefficiencies, greater liquidity and potentially the advent of new and innovative products in the Brazilian market. “The merger, coupled with the availability of DMA, may prove to be the first big step in integrating the natural liquidity flows between the country’s cash and derivatives market,” added Beck. “As the environment and technological demands in Brazil change and grow to be more supportive of advanced tools and strategies, we will provide them for our clients and ourselves.”
UBS clients can send front-to-back electronic orders directly from desktop execution management systems (EMS) and order management systems (OMS), including UBS’s Pinpoint EMS.
Beck also outlined UBS’ further growth plans for the Latin-America region. “The two ‘investment grade’ markets in Latin America are Brazil and Mexico, so we anticipate Mexico will be the next logical step for UBS in this region,” he said.