The City of London has seen the launch of the first electronic platform for processing trades between banks.
US-based technology group ITG is offering its Posit Now platform to investment banks searching for the cheapest and most liquid market in some 9,000 stocks from 15 different European countries.
Platforms for banks to trade directly with each other are expected to flourish when new EU regulations called the Markets in Financial Instruments Directive (Mifid) come into force on 1 November.
Mifid will remove member states’ rules that compel banks to place all trades on national stock exchanges. Banks will be free to use pan-European trading platforms with lower margins than the exchanges.
Seven investment banks are building their own pan-European exchange to take advantage of the Mifid rules.
ITG Europe’s CEO Alasdair Haynes said, “We expect Posit to benefit from the implementation of Mifid and its requirement for market participants to investigate all sources of liquidity to ensure best execution.”
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