NYSE/DB – why Brussels got it wrong
Not much surprise at this week’s news then, but the rationale for blocking the deal seems odd. Firstly, and whatever they may claim, Brussels did take an overly Eurocentric view. Just call the CME in Chicago and ask where Liffe and Eurex appear on its list of major competitors. Secondly, the Commission claims that LIFFE and EUREX themselves compete but, in fact, they are effectively... Read More
Tobin, or not Tobin – that is the question
Well at least it is in France, as reports seem to confirm that its finance minister is enthusiastically pushing ahead with a unilateral Tobin-style tax on equities, bonds and derivatives trading. It’s a shame that the proponents of such a tax don’t seem to have done even a basic amount of homework. The original idea introduced by Nobel Laureate economist James Tobin was conceived... Read More
All I want for Xmas is exchange consolidation/competition (delete as appropriate)
Despite all the announcements, press briefings and other hullabaloo it looks like the BATS/Chi-X deal is the only one that’s actually going to get done this year. SGX/ASX and LSE/TMX are just two of the higher profile casualties in the global game of exchange Monopoly. Add to this the conversations and negotiations that never reached the public domain and you have a dazzling array... Read More
And the good news is….
Feels like it’s a pretty tough time to be in global banking right now. If it’s not falling volumes then it’s layoffs or, worse still, actors like Bill Nighy bleating on about the need for a Robin Hood tax hitting the headlines. And on both sides of the Atlantic we have regulators that seem oblivious to the damage they leave in their wake as they dream up yet more ways... Read More
MiFID II – 10 key takeaways that will give you indigestion
Just back from a two week trip around Asia and Australia that took in dark pool seminars in Hong Kong and Singapore and attendance at the FPL conference in Sydney. In my absence, it seems like the Eurocrats in Brussels have been busy as the official version of the widely leaked MiFID II proposals came out last Thursday. For a good roundup of the general themes look no further than... Read More
The rain in Spain stays mainly on the BME
Interesting contrast last week where the LSE’s market share of the FTSE 100 fell definitively below 50% whilst at the same time BME’s market share in the IBEX 35 remained stubbornly close to 100%. Both markets are in Europe – check. Both are subject to the MiFID directive – check. Both have significant levels of liquidity – check. So what is going on? The difference... Read More
Market data and the prisoner’s dilemma
The prisoner’s dilemma is an aspect of game theory that shows why two individuals might not agree, even if it appears that it’s best to do so. In its simplest version, two prisoners have to decide whether to assist or betray one another. If they co-operate then they both receive relatively light punishments, whereas a betrayal by one prisoner means that the other is severely... Read More
FragINSIGHT – taking a closer look at Asia Pacific
Welcome to the September issue of FragINSIGHT which provides an in-depth study of the Japanese market and an update on developments in Australia, together with our regular analysis of fragmentation across the USA, Canada, Europe and Japan. Also included on page 4 is a useful at-a-glance summary of the global regulatory spectrum. Download your copy here. Thanks to everyone for their... Read More
Divided we stand, united we fall
To say that it has been a turbulent time in global equities markets is something of an understatement, but the European picture provides some interesting pointers to the bigger geopolitical debate that’s going on. A couple of events in particular caught my attention. First, there was the ban on short-selling in banking stocks imposed by France, Italy, Spain and Belgium and the... Read More
European fragmentation in focus
It’s been interesting to watch the European MTFs jockeying for position over the summer. Seems like Chi-X is continuing to grow its market share of all European indices fairly steadily, whilst the relative market shares of Bats Europe and the LSE’s Turquoise could be starting to invert. This could possibly be down to Turquoise’s spangly new matching platform attracting the... Read More
