The London Stock Exchange is looking atvarious ways of improving its core trading platformto make it more competitive.
In June, a spokesman at the exchange said that Tradelect brought
next-generation technology to the company, butit is now
considering whether to replace or upgradethe systemto keep pace
with changes in the industry.
Its options include acquiring a competitor to gain new
technology.
Meanwhile, one of its competitors is up for sale. Turquoise, a
pan-European trading venue, has sent sales notices to potential
buyersand its CEO has confirmed it is exploring its strategic
options.
Turquoise, which was set up by nine investment banks, is one of
the new competitors that are putting pressure on the London Stock
Exchange. These companies have arisen following the introduction of
the Markets in Financial Services Directive (Mifid) legislation.
This law liberalised the stock trading sector and led to the
creation of new trading venues.
Turquoise, under the leadership of Yan L'Hullier, has
built a trading platform from scratch using off-the-shelf
technology. Its core trading system uses technology from
Cinnober.
Chris Skinner, CEO at think-tank the Financial Services Club,
said Turquoise has struggled to take market share in comparison
with the London Stock Exchange's main competitor Chi-X.
Bob McDowall, analyst at Towergroup, said Turquoise could be a
good fit for the London Stock Exchange. "Turquoise is not going to
get the best price at the moment and I do not think it will want a
sale to be too leisurely."
He said Turquoise has customised its Cinnober platform so much
that it is virtually proprietary.