SWX Swiss Block, the new non-displayed liquidity source for Swiss equities, will offer users “complete neutrality”, according to Lee Hodgkinson, CEO, SWX Europe.
“Neutrality is going to be very important for the buy-side in the years ahead,” Hodgkinson told theTRADEnews.com. “In partnering with NYFIX, we are working with a firm that operates on a market neutral basis and has a long history in the US dark liquidity space. We want to combine its technology with our community of participants, who have a strong interest in creating Swiss blue chip liquidity.”
Agency broker and solutions provider NYFIX will have operational management responsibility for SWX Swiss Block, which will use the same technology platform as NYFIX’s Euro Millennium dark pool. SWX Europe’s existing partners – LCH.Clearnet and SIS x-clear – will provide clearing and settlement services.
SWX Europe, the London-based equities trading venue owned by SWX Swiss Exchange, has signed up eleven brokers – including Credit Suisse, Deutsche Bank and UBS – to SWX Swiss Block ahead of its August launch. SWX Swiss Block will initially concentrate on trading the Swiss blue chip stocks already available on SWX Europe, before giving firms the option of trading mid- and small-cap stocks.
“We are of the opinion that one size no longer fits all. Purely following the public limit order book construct is not going to meet the need of our customers in the years ahead,” added Hodgkinson. “Because we want to capture business from the stat-arb, high-frequency firms, we are changing our technology to do that, but we also wanted to expand our service boundaries into the wholesale end of the value chain.”
Hodgkinson expects the first sell-side customers to migrate to the platform by 11 August, with more brokers expected to connect in due course, “We hope to reach 25-30 firms by the end of the year. We will be rolling each of the customers we have
announced onto the platform, as and when they are ready throughout August,” he said.