Chi-X Europe, a pan-European equity multilateral trading facility (MTF), has started trading, clearing and settling five of the top component stocks of the Belgium BEL 20 index.
The MTF also has plans to introduce the remainder of the index’s components later in the month. At present, the first stocks available for trading are Dehaize, Inbev, KBC Groep, Solvay, Umicore.
Clearing for these stocks will be dealt with by Fortis’ European Multilateral Clearing Facility and the Euroclear central securities depository will handle settlement. In addition, trades in these stocks will also be fully fungible with BEL 20 trades transacted on the primary market.
Chi-X believe that trading the BEL 20 component stocks on its platform will be less expensive than through the current market infrastructure for overall trading, clearing and settling. An analysis by Chi-X’s parent company Instinet showed that execution costs on the underlying exchange is 1.09 bps compared to the 0.05 bps on Chi-X, based on a passive/aggressive rebate ratio of 50:50.
“Since launching some 15 months ago, we have introduced trading services for many of Europe’s most heavily-traded equities and are pleased to extend coverage to these Belgian names,” said Peter Randall, CEO of Chi-X Europe, in a statement. “Chi-X Europe participants continue to enjoy price improvement and lower trading costs, and we remain committed to providing the European trading community with the benefits of our faster, cheaper and smarter model.”