Monthly MiFID MTF Monitor: January 2010

The Financial Services Club is pleased to announce that we have recently agreed a partnership with Thomson Reuters Equity Market Share Reporter (EMSR) to provide a monthly MiFID MTF Monitor.  Our aim is to show how the pan-European investment markets are changing as a result of the MiFID and the entry of the new MTFs. 

EMSR provides extensive, amazing, insightful and very indepth analysis of pan-European trades via electronic and OTC trading, including trade reporting on and off exchange through internalisation reports via Markit BOAT, as well as a pure comparison of trading venues, including dark pools. 

For example, and to begin with, here are the trading stats in euro by trading venue* for January 2009 and January 2010 (doubleclick images to see larger version):

 
Source: Thomson Reuters Equity Market Share Reporter (ENX=Euronext, Xetra = Deutsche Bourse)

As can be seen, Chi-X have now reached the Number 1 spot for all European trading.  Interesting to see how this has changed over two years.  For example, here's the picture back in January 2008:

Meanwhile, if you include on- and off- exchange trades, including all OTC activity, the picture is more like this:

 

Source: Thomson Reuters Equity Market Share Reporter

Hmmmm ... no wonder LSE has been struggling.

Meanwhile, it's also interesting to compare the actual trading by value on the MTFs year-on-year:

 

Source: Thomson Reuters Equity Market Share Reporter

What happened to Turquoise you may ask?  (a) their stakeholders contracts expired; and (b) they got acquired.

Finally, if you really want the detail, then the numbers are interesting (doubleclick to enlarge):

So, there you have our first monthly MiFID monitor.   More to come, and lots of analysis and information we could share.  All in all, thanks to Thomson Reuters for sharing ...

 

* these figures reflect auction and non-auction transparent order book and dark pool trades, but excludes real-time and post-trade on-exchange reported and off-exchange OTC trades in order to provide a true comparison between the MTFs impact and the traditional exchanges.

Comments

[Hugh Simpson]

The figures are really interesting, but they give you different messages, depending on which ones you look at.

For example, the headline story is "Chi-X overtakes LSE", but I have two comments on this. 1. It is comparing a pan-European platform (Chi-X) with a domestic platform (LSE). 2. The picture is quite different when you look at the figures including OTC business, when BOAT emerges as the real winner and the LSE comes out ahead of Chi-X.

Another sub-plot is the way that the emergence of the MTFs seems to have helped Xetra overtake the LSE in the on-market business. I suspect this owes a great deal to post-trade processes. It is easier to eat into the UK market, with a relatively open post-trade process, than into the German market, where the CCP and CSD are contolled by the exchange.

I have also written about this on the Bourse Consult blog at http://www.bourse-consult.com/?p=254#more-254