Pan-European trading venues Nasdaq OMX Europe, BATS Europe and Chi-X will collaborate to create a common symbology for European stocks, to make it easier for investors to locate the best price.
“With a single symbology, you can join data together more easily because they are all working from the same symbol,” Todd Golub, head of markets development at Nasdaq OMX Europe, told theTRADEnews.com. “With so many different European market places, consolidating data is important to see where the best price is.”
The three pan-European multilateral trading facilities have formed an industry working group, which is open to all European execution venues, to develop the uniform symbology framework.
As well as supporting consolidation of market data from European multilateral trading facilities (MTFs) and exchanges, the initiative aims to facilitate more effective smart order routing.
Golub claimed that the new symbology framework would start to solve the difficulties of traders in obtaining an accurate picture of the European equities markets following increased liquidity fragmentation since the introduction of MiFID.
“A consolidated tape would have to come further down the line,” says Golub. “But I think everyone is aware that common symbology is necessary for that.”
A notable absentee from the collaboration is Turquoise, the broker-backed multilateral trading facility that launched last month. Although Turquoise initially turned down the offer to join their rival MTFs, Golub insisted the door remained open.
“Anyone else who wants to join is welcome to do so. I expect the announcement will kindle some interest from other venues.”