Citadel Securities, a trading arm of Citadel Investment Group, the Chicago-based hedge fund and trading firm, is all set to make a significant equity investment in Equiduct – reported Financial Times.
The Mifid directive, enacted by the European commission three years back, has stirred up competition among Europe’s established exchanges and gave birth to new multilateral trading facilities such as Chi-X Europe, Turquoise and BATS Europe. Furthermore, most of the institutional investors and trading firms are also favouring fast electronic trading systems. This has opened a window of opportunity for Equiduct to encourage retail flow onto its platform, including capturing orders executed on other venues.
With this transaction, Citadel wants to transform Equiduct into a pan-European platform facilitating share trading among retail, or smaller investors. The rationale behind this move is to replicate what Citadel has done in the US through its investment in Direct Edge (which has emerged as one of the well known exchanges in the US), along with NYSE Euronext, Nasdaq OMX and BATS Global Markets, reported the newspaper.
Artur Fischer, CEO of Equiduct, said: Mifid has been out for over a year and it has taken some time for retail investors in France, Germany and Italy to understand that there are MTFs. They are slowly putting pressure on their banks to hook up to the new venues and Equiduct provides a one-stop solution for that.
To offer exchange services to financial institutions trading in the European markets, in 2007, Börse Berlin, a small German regional stock exchange, had acquired 53% stake in London-based Equiduct Systems and formed Equiduct.
