Highlights from the 3Q17 preliminary Global Cost Review
Inflows were observed globally, and trading costs remained depressed despite a slight uptick from lows in 2Q2017. Global large-cap stocks saw inflows for the first time in six quarters, with costs increasing for this market capitalization in many regions.
- US: US costs increased 26% from 2Q2017, partly driven by a 40% increase in large-cap costs. Small-cap costs rose 19% following the tick size pilot launch in 2Q2016.
- CAN: Large-cap inflows were coupled with increasing costs, although overall country-level costs have remained consistent over the past year and a half.
- LATAM: Flows were flat for the first time in six quarters. Small-cap net outflows of 21% were coupled with a 79% decrease in costs in the region.
- EU: Net inflows in large caps drove overall flows in the region. Costs have decreased by 14% over the past five years in Europe, and we’ll check back to see if this trend continues following January’s MIFID II effective date.
- APAC: Small-cap stocks recorded regional inflows combined with increasing costs.