December 11 2015


elb2While a wodge of senior NASDAQ execs celebrate the smooth launch of their systems trading Turkish equities in Istanbul, Odey reiterates its support for Plus 500 while the IEX application has drawn analysis from Larry Tabb amongst others…

Finally, bravo the good folks of ICAP, raising a whisker short of 11.5 million dollars in one charity day (GBP 7,500,000).

Let’s get to the pith:

Public Markets

Odey Asset Management Divests 25% Stake In Plus500 With CFDs

Victor Golovtchenko – Finance Magnates

After a spat with the management of the company over the deal with Playtech, Odey Asset Management has reaffirmed its commitment to hold shares of Plus500.

QV Premium: Plus500 Turmoil & Deal – Brief – Part 2 and Exchange Deals Brief 2.

PLY: So they are holding but shuffling how they hold…Meanwhile JPM is not holding but has 10%-ish as custodian. Back in London, Plus500 began onboarding clients through its FCA vehicle this morning, according to Finance Magnates.


Substantive Issues Surround IEX Exchange Application (subscription)

Larry Tabb – Financial Times

SEC has received more than 30 comment letters, including one by yours truly. To put this into context, there was only one letter submitted when BATS Global Markets made its application in 2008, and three for Direct Edge in 2009.

While petty jealousy makes headlines and the threat of competition always gets attention, the real reasons the IEX exchange application has been given so much focus are the very substantive issues: the speed bump, the router and maybe even the threat of upsetting exchanges’ data and infrastructure franchises…

PLY: Larry does his best to frustrate President Truman’s desire for a one-handed economist with this deft endeavour to keep all his clients happy across the myriad US equity market structure which, let’s face it, Larry knows very very well indeed. That 30 comment letters have appeared for the “Flash Boys” exchange actually strikes me as being low – the rather myopic end of the HFT spectrum was never about to give ground which it sees as a God-given right to front run paper orders and has added to the comment count by saying the same thing repeatedly. On a macro point, the difficulty remains that the vast wodge of corporate blobsters reading the FT will have gone 4 lines into this and, despite Larry’s most lively prose, will have moved to the next story in the Brussels Bugle. That is a useful point to ponder as the big picture is where US equity market structure is lost right now. Retail investors feel exploited, know they are paying a lot more than 18 cents / 100 shares (which their brokers bridle at paying out of commissions’ received) and frankly see 350 microseconds as irrelevant when their existing order flow is picked off by snipers lining the ridges above the order book along the equity equivalent of the Khyber Pass. In the big picture, there is no argument, it is only by exploiting the arcanely erroneous background to Reg NMS that the opponents of IEX can guard their already dysfunctional status quo.

Modern Markets Initiative Weighs In On IEX Exchange Application & HFT Assertions

Traders Magazine

PLY: MMI comment notes IEX’s remarks about ‘pernicious HFT’ then neatly sidesteps doing anything to discuss this problem, preferring instead to inelegantly twist recent dismissal of other lawsuits as proof that exchanges not being seen to be guilty of helping promote HFT in specific instances, ergo, this proves that exchanges are not favouring HFT.

It’s a deft syllogism but a rather artless response from the MMI which really isn’t doing anything to coherently progress a public interest defence of HFT.

More about IEX here.


LME To Move Trading Floor To New Premises On February 1

Eric Onstad – Reuters

LME said in January it was consolidating all its functions in the new location – Finsbury Square – but had not announced the exact dates of the move. LME said in a statement it would conclude trading at its current offices on Leadenhall Street, on Jan. 27. For the next two working days, trading will take place at the LME’s disaster recovery site in Chelmsford, east of London, before trading is launched at the new premises.

PLY: Floor photograph souvenir hunters will clearly be rushing to Chelmsford January 28th…

Private Markets

KRX & SSE To Research Stock & Bond Trading Link


Korea Exchange (KRX) said on Friday that it has agreed with the Shanghai SE (SSE) to study a plan to link the two marketplaces for trading stocks and bonds.


ZSE Only A Step Away From LJSE Takeover (subscription)


Zagreb SE (ZSE) has successfully completed a recapitalisation needed for the acquisition of Ljubljana SE (LJSE) from CEESEG. It now only needs a regulatory approval to complete the transaction. (the takeover agreement was signed in July). QV Premium: CEESEG Stakes Sales Brief.


Bulgarian President: We Work For The Creation Of A Regional Energy Exchange For SEE


Bulgarian President Rosen Plevneliev: “The electricity market in Bulgaria will be fully liberalised within a few months. We work for the creation of a regional energy exchange for Southeast Europe, drawing upon the experience of Slovakia and countries of Central Europe”. QV Premium: SEE Link Project Brief.


Miami International Holdings Announces Plans to Launch A Price-Time Options Exchange in 2016


Miami International Holdings (MIH) (owner of MIAX Options Exchange) plans to launch a second U.S. options exchange. The new exchange will leverage MIAX’s industry leading technology and infrastructure to employ a price-time allocation model, and will enable MIH to compete for a segment of order flow that does not trade on the pro-rata market that MIAX currently operates. MIH anticipates launching its new price-time exchange Q3 2016, pending SEC approval.


trueEX Eyes European Growth

Markets Media

trueEX CEO Sunil Hirani, said the US exchange & SEF will expand in Europe as swaps clearing becomes mandatory in the region next year.


Margin Trading Launched At Qatar SE


Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX and FTIL flat to slightly off.


Borsa Istanbul Goes Live On Nasdaq Technology Suite – BISTECH


PLY: A suite of NASDAQ execs are in Istanbul today, rightly celebrating the latest on time delivery of their IT services which have been running smoothly for a week or so already in Turkish stock trading. This latest installation is perhaps all the more remarkable as BIST didn’t actually have a CTO for much of the process and relied on NASDAQ’s input. Readers will recall that NASDAQ exchanged their tech licence for equity in the Istanbul exchange.


DelphX To Cache Bond Inventories To Meet Liquidity


DelphX is restoring dealers’ ability to provide on-demand market liquidity by enabling them to access inventories held by institutional investors. The patent-pending Cached Inventory technology will reduce dealers’ capital requirements by eliminating their need to hold extensive fixed income inventory, while asset managers will benefit from preferential pricing and improved allocations in both the primary and secondary markets.

PLY: Very interesting.


Singapore LNG Futures Could Launch Next Month (subscription)

Jake Maxwell Watts – Wall Street Journal

SGX is set to launch cash-settled futures and swaps contracts for liquefied natural gas as early as January.


Steven Maijoor, Chairman, ESMA Keynote At L’Agefi Regulation Financiere 2015 On CMU & Bond Markets


EU Regulator Stands By Mifid II Bond Rules (subscription)

Tim Cave – Financial News

Steven Maijoor says the revised version of Mifid will help foster liquidity.


CME Europe Trading Exceeds 1,000,000 Lots Since Launch


CME Europe launched in April 2014, and the total volume of contracts traded since launch stood at 1,002,497 as of 10 December 2015.

PLY: We’re not into general volume announcements as there are just too many but this is an elegant benchmark to surpass and I applaud Cees Vermaas and his team at CME Europe.


RBI Introduces Cross-Currency Options In Exchanges

Business Standard

Reserve Bank of India (RBI) introduced cross-currency pairs in the exchange-traded currency derivatives market in order to facilitate efficient hedging.


Indonesia To Introduce Sovereign Bond Futures Next Year

Straits Times


Al Premium Contracts Go Untraded – A Victim Of LME’s Success In Tackling Queues (subscription)

Metal Bulletin

LME’s new aluminium premium contracts remain untraded two weeks on from launch, but the lack of interest in the contracts is a testament to the belated success of LME’s warehouse reforms.

PLY: An interesting situation…


NYSE Governance Services Launches Innovative Service For Corporate Boards


FORGE – the Future of Responsibility, Governance and Ethics – is a quarterly forum of executives, directors and industry influencers that will produce actionable insights and meaningful data on the most pressing boardroom topics.

Career Paths

The Hindu reports that Metropolitan SE (formerly MCX Stock Exchange) is set to appoint its interim MD & CEO Udai Kumar as MD & CEO.

PLY: Congratulations to Udai Kumar and all the best steering MCX-SE forward.

BGC Partners appointed Nicole Shaughnessy as MD, Environmental Products. She reports to Shawn McLoughlin, Senior MD of New Business Development, BGC.

FESE General Assembly unanimously agreed the appointment of Mr Marios A. Pilavakis, Chairman of the Board of Directors (Council) of the Cyprus SE (CSE) as Member of the Board for a term of three years.

Mr Pilavakis will join the following Members to the Board:

FESE President: Deirdre Somers, Irish SE
FESE Vice President: Martin Reck, DB1
Carlos López Marqués, BME
Michael Buhl, CEESEG
Uwe Schweickert, DB1
Lee Hodgkinson , Euronext
Tim Grange, ICE
Robert Scharfe, Luxembourg SE
Magnus Billing, NASDAQ
Bente A. Landsnes, Oslo Børs
Ian Cornwall, SIX Swiss Exchange

PLY: Good to see Marios Pilavakis joining the FESE board. The Cyprus SE CEO Nondas Metaxas was a longstanding and productive member of the FESE board until November 2013

Financial Calendar

11.12. – ITG $0.07 quarterly dividend payment

Next week

14.12 – Record date NASDAQ $0.25 quarterly dividend

14.12 – Interactive Brokers $0.10 quarterly dividend payment

15.12 – Thomson Reuters $0.335 quarterly dividend payment

16.12 – Record date ICE $0.75 dividend

16.12 – CFTC – Open Commission Meeting (press release)

18.12 – CBOE $0.23 quarterly cash dividend payment

All forthcoming exchange / investment related events are now listed in our Events page.

Other stories

European Federation Of Investors & Financial Services Users: Where Is The Single EU Market For Financial Services? A New Green Paper From The EU



Plans To Withdraw Dark Rules Anti-Avoidance Provision – IIROC Proposes Amendments And Guidance For Best Execution


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