Agency broker Neonet Securities has teamed up with quantitative research specialist LiquidMetrix to develop a new suite of algorithms.
Neonet CEO, Tim Wildenberg, who joined the firm earlier this year from Citi, said the collaboration will help the broker build innovative algorithms, complimented by high quality execution.
“We’ve had an algo suite for a while now but we really want to become a leader in this space rather than a follower,” said Wildenberg. “This deal will help combine our expertise in electronic trading and smart order routing with LiquidMetrix’s specialist knowledge of quantitative research and transaction cost analysis (TCA) to build a very differentiated offering for clients.”
The algo suite also promises to be free from conflicts of interest, something that has become increasingly important with traders as regulators attempt to increase transparency. In a recent speech, Martin Wheatley, CEO of UK regulator the Financial Conduct Authority (FCA) said buy-sider firms needed to do more to separate the costs of execution and research to minimise such conflicts and also proposed extending this across Europe through MiFID II.
“Clients are really starting to focus on reducing conflicts of interest in their business and I’m confident this will help to see a proper marketplace for both execution and research to develop. Neonet is well positioned to add value around the execution space, with partners who specialise in research,” Wildenberg added.
Neonet and LiquidMetrix have already begun work on developing the new algorithms and hope to be able to get client feedback before Christmas. Further announcements on when the new algorithms will be ready to launch are expected in the New Year.