Pan-European Exchange Brings Fresh Competition

Terry Flanagan

Aquis Exchange, a proposed pan-European equities trading exchange, aims to inject fresh competition into the marketplace in order to lower trading costs.

Currently, over 90% of European equity trading in each individual country takes place on two exchanges. Aquis Exchange, established in October 2012, has set out to revolutionize the European trading landscape and increase competition in the market by introducing tiered subscription-based pricing and innovative order types on its high performance trading platform.

Aquis Exchange plans to offer equities from several markets for trading, including France, Germany, Italy, Netherlands, Sweden, and the UK.

It has selected TradeView from Datacom Systems to monitor the real time quality of its market data feeds. TradeView monitors the health of critical market data feeds, including microbursts and the detection of multicast gaps.

“I believe that in addition to bringing fresh competition and innovation to the European equity markets, Aquis Exchange will introduce higher levels of service and security to its Members – Datacom’s TradeView is an important element of this enhanced service,” said Aquis Exchange CEO Alasdair Haynes.

Following the introduction of new regulation (MiFiD) in 2007 the European cash equity stock exchange business changed considerably. From 2008 to 2011 new competitors in the form of Multilateral Trading Facilities (MTFs) took significant market share from the incumbent national exchanges.

In 2012, this trend started to reverse, following the merger of the two largest MTFs in Europe. This is particularly evident in the London market where since December 2011 the LSE has increased market share in FTSE100 trading from 54% to 62% whilst the MTFs market share has fallen from 38% to 32%; however the two companies now account for over 94% of trades in the FTSE100.

Aquis Exchange’s subscription pricing works on a similar model to that of the telecoms industry and is designed to encourage participation from all categories of professional trading firm.

Users will be charged according to the message traffic they generate, rather than a percentage of the value of each stock that they trade. There will be different pricing bands to accommodate varying degrees of usage. There will be a very low usage band for small firms, that are traditionally disadvantaged by the pricing structure of the incumbent exchanges and, at the other end of the pricing structure, will be the top category where usage is unlimited (subject to a fair usage policy).

Interxion, a European provider of cloud- and carrier-neutral colocation data center services, said announced that Aquis Exchange is to take its second data center colocation facility at Interxion’s City of London data center campus.

Aquis Exchange called on Interxion to back-up its current operation, also located in London; a move which will enable the company to tap into Interxion’s financial community consisting of over 100 capital markets participants including investment firms, high-frequency trading firms, hedge funds, brokers and bankers.

“We are pleased to announce that our secondary data center is at Interxion’s London campus, which has a long and established heritage of providing colocation services to the financial industry,” said Haynes. “We are looking forward to the prospect of being able to deliver our services to their ever-expanding financial community.”

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