Mostly… fixed income and cross product eTrading

August 26, 2007

BIDS dark liquidity

Filed under: etrading — holky @ 8:09 am

BIDS gains footing — BIDS dark liquidity pool backed by 12 investment banks to bypass equity trading on major exchanges has made a big step forward after three Wall Street firms connected up their electronic trading platforms to the network – Goldman’s RediPlus, JP Morgan’s Neovest, and Morgan Stanley’s Passport. BIDS claim four more links imminently, and two others being worked on. So the sponsored buyside on these platforms can now trade blocks in the dark on BIDS.

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1 Comment »

  1. Is there any research on the effect of reduced information in pricing setting and the overall effect on the market ecosystem?
    In plain English, normally people try and disguise their actions when trading blocks, from simple actions such as iceberg orders up to algos and so on. But the “information” leaks to the market and has an impact on price setting – simple supply and demand rules apply.

    If trades are done off exchange at a mid price and then reported people take this into account (order book vwap vs overall vwap). But what happens when blocks trading all pulls out of the CLOB market and just gets trade reported at mid. Will this make the CLOB market more volatile – will prices tend to move in a more jerky manner? How will this affect hedging?

    I’d love to hear about anything done on this….

    Comment by John Greenan — September 4, 2007 @ 8:20 am


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