Liquidnet expands into Turkey
Institutional investors can now use buy-side crossing
network Liquidnet to trade Turkish stocks, following the platform’s connection
via a local broker to the Istanbul Stock Exchange (ISE).
Turkey is currently the seventh largest economy in
Europe, with 1,000 companies listed on the ISE and a total domestic market
capitalisation of €214.86 billion. The Turkish
government has been reforming its trading infrastructure and capital markets
law to keep pace with international investor demand; the ISE channelled €422 billion in new capital through IPOs last year, while Turkey’s
credit rating was upgraded in June this year to one step below investment grade
by Moody’s Investors Service, which cited the country’s improving fiscal
conditions as its primary impetus.
“The Turkish economy has shown strong signs of growth
despite global macro volatility, capturing the interest of portfolio managers
globally,” said Per Loven, head of corporate strategy for Liquidnet Europe. “As
Turkey continues on its path to becoming a regional financial powerhouse,
institutional investors looking to unlock value in Turkish growth companies
will now be able to source large-scale liquidity in those equities, with
minimal market impact, through our trading network.”
Turkey is the 40th market offered by Liquidnet for trading and follows the recent addition of Indonesian and
As part of the country’s modernisation efforts, which
have included adopting the same legal definitions of financial instruments and
capital market concepts as set out in Europe’s MiFID, a rule change that
allowed order cancellation on the ISE since late in 2010 has acted as a
catalyst for growth in algorithmic trading strategies.
Last month, Citi launched a suite of algorithmic and
direct market access trading products designed for the Turkish market, citing
high demand for access to the market from buy-side clients. Citi used its
broking subsidiary Citi Menkul to channel the new products onto the ISE.
“Turkish equities are attractive from an investment
perspective, and the addition of a new market to Liquidnet is welcomes as the
ability to trade Turkish equities anonymously, in block size, is a favourable
solution,” said Mandy Pike, global head of equity dealing at Aberdeen Asset