Thinking

2Q 2017 Preliminary Global Cost Review

Highlights from the 2Q 2017 preliminary Global Cost Review

  • Global trading costs are at an all-time low, which corresponds with the lowest volatility and spread regime we have seen in years. Costs are decreasing across market caps and across quarters regionally.  
  • This decrease has been driven by lower IS costs in large caps in developed markets. Europe ex-UK, Japan, Latin America, Middle East and Africa, and Canada showed strong decreasing IS costs quarter over quarter.
  • It’s not all good news, though. While overall costs have been decreasing, ITG’s TCA Peer universe shows that small caps have become more expensive to trade. US, Canada and Latin America show the largest change from Q1 to Q2 in 2017, averaging a 28% increase in costs.
  • Despite the increasing cost trend, small cap stocks continue the 6-quarter trend of net inflows.

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