Nasdaq OMX installs low-latency Columbian trading platform

The Bolsa de Valores de Colombia (BVC), Columbia’s domestic stock exchange, has launched a new high-speed cash equities trading system powered by Nasdaq OMX technology.

The new BVC system was introduced on 9 February and offers a high-volume, low-latency platform for market participants in Columbia.

The new engine will enable algorithmic and high-velocity traders to trade on the platform, as well as allowing the introduction of new trading products and services.

“Through our new equities system we are in a great position to grow business at our exchange and thus reach our 2015 goal of 200 new companies and 1.5 million Colombian families investing in our market,” said Juan Pablo Córdoba, president, BVC.

“It is extremely rewarding to complete the second part of our deployment at BVC,” said Lars Ottersgård, head of market technology, Nasdaq OMX. “BVC now has a trading system for both equities and derivatives based on internationally recognised standards, putting them at the forefront of South American exchanges.”

Smart Trade liquidity management tool adopts CEP

Smart Trade Technologies has agreed a deal to integrate EsperTech’s complex event processing (CEP) capabilities into its smartTrade liquidity management system (LMS).

The smartTrade LMS is used by buy- and sell-side firms to manage liquidity for best execution, smart routing of orders across multiple asset classes and geographies, and tighter control of order flow for risk management purposes. The system comprises four elements: LiquidityAggregator; LiquidityCrosser; LiquidityOrchestrator, a smart-order router; and LiquidityConnect, which link to multiple execution venues. Smart Trade co-founder and CTO David Vincent said the deal meant customers would be able to rely on a domain-specific CEP for their smart order routing, crossing and aggregation strategies on top of already existing programmable rules within the smartTrade LMS.

CEP will also improve the rules applied within the smartTrade LMS to produce complex levels of aggregated depth, by generating indicators derived from the raw feeds, such as moving averages, correlation factors and other statistics.

Asian investors cut broker relationships, execution fees - Greenwich

Asian institutional investors are prioritising sell-side research and advisory over execution services in volatile markets, while also cutting back their number of sell-side relationships, according a new report from consultancy Greenwich Associates.

The firm’s ‘Asian Equity Investors Study’ revealed that, among the largest trading institutions in Asia, the average number of sell-side relationships fell to 20.5 in 2008, from 24.5 in 2007.

The research also noted that a sharp decline in portfolio values and stock prices had shrunk the pool of institutions’ equity brokerage commission payments. Within these diminished pools, the proportion allocated to research, sales coverage and advisory services jumped 11 percentage points in 2008, to 66%, according to the study. This came at the expense of trading coverage and agency execution, which now accounts for to 26% of total commissions, down from one-third a year ago.

“The reversal of this trend does not mean there is less desire for superior execution, but rather that, in times of unprecedented market turmoil, the need for timely insights and access is even greater and the opportunity cost of not securing them is not something that investors want to risk,” said John Feng, consultant, Greenwich Associates.

Greenwich said that the reduction in sell-side relationships was caused by more cautious buy-side attitudes, prompted in part by counterparty risk issues stemming from the collapse of Bear Stearns and a retreat back to familiar markets instead of expanding investment operations. The firm also cited an increase in the use of commission sharing agreements (CSA) in the region. Two-thirds of institutions said they planned to use CSAs within 12 months and 40% reported using CSA services in 2008.

Credit Suisse AES forges derivatives links

Investment bank Credit Suisse’s Advanced Execution Services (AES) division, which supplies algorithms and trading tools to the buy-side, has expanded its derivatives capabilities by joining financial software firm Orc’s ExNet broker connectivity network and launching a joint offering with US options pricing and analytics firm Derivix.

AES’s new link with ExNet, which provides hedge funds, proprietary traders and other advanced traders access to liquidity pools, allows users of Orc’s trading systems to trade futures, options and cash equities using AES algorithms and market access.

“In particular, we have an advanced set of algorithms available in derivatives markets where Orc Software is well known,” said Guy Cirillo, global head of channel sales at Credit Suisse AES. “Now, Orc and Credit Suisse customers can together take advantage of our execution algorithms and market connections.”

The joint solution with Derivix will allow the firm’s customers direct access to AES’s options and stock algorithms for use alongside Derivix’s options pricing and analytics. Using FIX connectivity, options traders will be able to access AES from within Derivix’s analytics front-end.

UK: Plastic Venture

European Metal Recycling in the United Kingdom has partnered with Richmond, Calif.-based MBA Polymers to launch a company that will build and operate a plastics recycling plant in the British town of Worksop. As part of the partnership, EMR will concentrate the plastics from the shredder residue that is produced from its metal recycling operation. The material, which would otherwise be incinerated or put in a landfill, will then be shipped to the joint-venture company, which will clean, sort, and upgrade the plastics. MBA will then sell the plastics to its customers.

Burgundy chooses EMCF, plans multi-clearer model

Burgundy, a multilateral trading facility for Nordic securities, has chosen European Multilateral Clearing Facility (EMCF) as its central counterparty (CCP), and is looking to add other clearers as the platform develops. Burgundy aims to start trading in Q2 this year and introduce full CCP clearing in October. Before then, participants will clear trades on the platform bilaterally.

“We have decided to open up to competitive clearing,” Olof Neiglick, CEO of Burgundy, told theTRADEnews.com. “Once the project matures, we will add more CCPs. Two additional clearing providers will be available in the Nordic market by the end of the year.”

Burgundy chose EMCF as its initial clearing provider based on the preferences of the banks and securities firms in the consortium that founded the platform. “A number of the banks are already members, so it had a first-mover advantage,” said Neiglick.

Burgundy’s shareholders are Avanza Bank, Danske Bank, D. Carnegie & Co, DnB NOR, Evli Bank, HQ Bank, Kaupthing Bank (Sweden), NeoNet, Nordea, Nordnet, SEB, Svenska Handelsbanken, Swedbank and Öhman.

Burgundy trades will be fully fungible with those conducted on other trading platforms connected to EMCF. “You will be able to buy a position on one platform and sell it on Burgundy, for example. That is extremely important for efficiency,” said Neiglick. “There is full netting and cross-clearing between all platforms connected to EMCF.”

FXall adds netting service to trading platform

Electronic foreign exchange trading platform FXall has launched Cross Currency Netting, a new feature enabling users to manage high-value multi-currency exposures in volatile markets. The new feature is part of the company’s commitment to improve its platform, which is used by institutional clients such as asset managers, corporate treasurers, hedge funds and banks.

Cross Currency Netting combines tools which help clients identify principal risks within a currency portfolio so they can be transferred to their chosen bank or custodian. The details are automatically processed by FXall’s integrated workflow and straight-through processing capabilities.

The new feature enables customers to consult their bank or custodian about the optimal trading strategy in a fully automated way and with a complete audit trail. FXall said this allows clients to operate more efficiently, use the expertise of their partners, and maintain a controlled, error-free environment.

“As an established and committed long-term partner, we are constantly investing in our platform to establish new products to best serve the needs of our clients,” said Phil Weisberg, CEO, FXall, in a statement. “Cross Currency Netting is one such initiative, allowing our clients to execute trades in the most efficient and cost-effective way.”