09.15.2011

Europe Gets Market Making Technology

09.15.2011
Terry Flanagan

MiFID II expected to hike demand for liquidity.

Liquidity in Europe is anticipated to increase with the introduction of new regulations such as MiFID II. That’s triggering a demand for market making technology that’s industrial-strength.

“If the proposed MiFID II regulation arrives, then we would expect increased liquidity in listed instruments on exchanges,” Markus Kämpe, senior product manager at Orc Software, told Markets Media.

“We would then expect demand for Orc’s products to increase as more market makers and other market participants enter the listed trading space to trade these previously OTC contracts,” he said.

Orc Software has released a version of its Market Maker application for EMEA. The system features a server-based quoting engine and the ability to connect to multiple markets from a single screen.

Orc Market Maker is a high performance market making application designed for market making globally, but Orc has tailored it account for regional differences.

“Every market maker on every market operates a little differently.” said Kämpe.  “We’ve tuned Orc Market Maker specifically for EMEA. Market makers in Europe will gain the benefits of a robust application built for global markets along with the specific features needed to perform at their best on various European exchanges like Eurex.”

Increased automation, more sophisticated technology and higher levels of competition have left many market makers struggling to retain profits. Many of the most successful market making operations are characterized by geographically diverse, large scale activities paired with slim, efficient operations. A crucial pre-requisite for these organizations is adequate utilization of technology and services.

“Orc Market Maker is a response to the demands from these market makers,” said Kämpe. “It gives them a powerful market making application that can be deployed quickly into the market. In addition, it gives them the ability to expand geographically to other, perhaps less-competitive markets, where they can grow their business.”

With support for options, warrants, and structured products, Orc Market Maker can be utilized across desks. Furthermore, customers have the choice to buy Orc Market Maker as a managed service, thus enabling co-located, low-latency, scalable market making across multiple markets and asset classes with low cost of ownership.

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