In The Media

  • Friday, June 22, will be one of the biggest – and busiest – trading days in the U.S. equity market, with turnover expected in the $300 to $400 billion range, as investment managers adjust their portfolios in accordance with the Russell Reconstitution, the annual change in the benchmark FTSE Russell investment indices. The large-cap Russell 1000, small/midcap Russell 2000 and broad Russell 3000 are among the most widely followed U.S. indices, with an estimated $1.2 trillion in assets tracking the benchmarks.

    We project that this year’s reconstitution will lead to approximately $30 billion in net turnover, higher than last year’s $23 billion in turnover.

    Some highlights of this year’s trade include…..

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  • Since MiFID II’s January 3 go-live date the changing market structure dynamics in Europe have been top of mind for investors in Europe and globally. With more than a full quarter of trading activity since MiFID II took effect, ITG is providing an update on the significant changes in equities markets.

    ITG has leveraged its unique broker-neutral TCA Global Peer universe of algorithmic trading to compare venue usage from the end of 2017 through the end of April 2018. This data set provides an exclusive view into how firms are adapting their execution venue choices as a result of the new regulation, including the impact of double volume caps (DVCs) for activity after March 12.

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  • Block trades accounted for more than half of dark trading last week as the industry continues to adopt block trading in the wake of MiFID II.

    Statistics from Fidessa revealed that block trades accounted for a record 51.9% of dark trading for the week ending 18 May, compared to just 16.06% in the same week last year.

    Block trading volumes increased significantly following the introduction of MiFID II’s double volume caps (DVCs) on 12 March this year, as the regulation looked to shift dark trading towards on-exchange or lit order books.

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  • This year’s ranking comes at an interesting time for the market: While U.S. equity prices continue to soar, a return of volatility has resulted in shakier ground for investing. As of midday on Tuesday, the volatility index had increased by roughly 21 percent year-over-year, from 12.04 to 14.66. The 2018 All-America Trading Team was decided by over 350 buy-side traders and other investment professionals at asset management firms investing in U.S. equities. Institutional Investor asked these pros to rank the best firms at trading and execution services across three main categories: electronic trading, high touch trading, and portfolio trading.

    In electronic trading, firms were judged on access to large electronic blocks of liquidity, customized trading algorithms and support, pre- and post-trade cost analysis and execution consulting, among other attributes. In this category, ITG placed second after Morgan Stanley, and BofA Merrill Lynch came in third.

    ITG’s chief executive officer, Frank Troise, said his independent trading firm is eyeing a larger market share in the wake of European regulation requiring separate payments for research and execution.

    “Our goal is delivering unmatched client service and best-in-class products in our four key offerings: execution, liquidity, analytics, and workflow technology,” Troise said via email. “We are well-positioned to capitalize on the increased global focus on best execution and performance measurement, particularly as more institutional investors unbundle execution from research and seek liquidity via innovative technology solutions.”

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  • China’s stock market will finally join MSCI Inc.’s global indexes on June 1, but there are still some sticking points that worry brokers and could cause a trading upset.

    Among the concerns are the Shanghai Stock Exchange’s lack of a closing auction — which index-tracking funds often use to get the day’s final price — and whether brokers have sufficient capacity with Hong Kong’s bourse to be able to send what could be as much as $40 billion worth of orders north, according to traders in the city.

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