Turquoise, a pan-European multilateral trading facility, says pressure from other trading venues has led to its withdrawal of plans to begin daily trading at 07.45 UK time – 15 minutes earlier than Europe’s incumbent exchanges.
Eli Lederman, Turquoise’s CEO, told theTRADEnews.com that support for the idea among the buy- and sell-side tailed off after two exchanges, Deutsche Börse and the London Stock Exchange (LSE), indicated they would also open earlier. Deutsche Börse had considered opening at 07.30 UK time, and it is understood that the LSE would have matched Turquoise’s opening time.
Both buy- and sell-side firms baulked when it appeared that other exchanges were going to follow Turquoise’s lead. “People had been very supportive of our plan to open early,” Lederman claimed, stressing that the early start would only have been temporary. “We consulted extensively with the buy- and the sell-side on this over recent months and they supported us, but when the exchanges threatened to move forward, we started to lose support.”
He added, “People thought that this would begin a cycle of racing to earlier times. That was never our intention, and we don’t think it’s good for the market, so we consulted again and decided to move the opening back 15 minutes to match everyone else.”
A spokesperson for the LSE declined to comment on whether the exchange had considered changing its opening time, but said its position is to “respond to market demand”.
Deutsche Börse spokesman Frank Herkenhoff confirmed that his exchange had been prepared to open at 07.30 UK time. “We want to make sure that the initial auction for the shares traded at Deutsche Börse remains at Deutsche Börse and is not conducted anywhere else,” he said.
Deutsche Börse’s trading times will now remain unchanged, although the firm’s exchange council has voted for more flexibility should a similar situation arise in the future.
Although Turquoise touted early opening to provide a temporary initial boost, the MTF has no additional plans for capturing liquidity in its early stages. “We’re going to be fine – this is a blip on the radar,” Lederman said.
Turquoise plans to launch with limited trading on August 15, with a full trading in Europe’s 300 largest stocks available from early September.