Specifically, the offering is for brokers subscribed to the Aquis Matching Pool (AMP) order book which can instruct Aquis (through OptimX) to “deliver liquidity opportunities seamlessly within the institutional trader’s workflow”. 

Aquis Exchange picked up a minority stake in OptimX back in August 2023 as it looked to expand its block crossing remit.

The deal was completed as part of a consortium which also included Deutsche Boerse Group’s DB1 Ventures.

At the time, the deal was highlighted as particularly complimentary of Aquis’ AMP. 

Alasdair Haynes, Aquis’ chief executive officer, said: “The investment in OptimX is a significant opportunity for Aquis, adding additional connectivity to our successful dark pool (the Aquis Matching Pool) and providing clients with the ability to cross large blocks. 

“This alongside Aquis’s growing functionality will further enhance the range of execution options available to our members.” 

Read more: Aquis launches dark pool into Europe 

Earlier this year, Aquis Markets launched conditional order functionality across the UK and EU platforms, wherein members using the functionality send an ‘indication of interest’ (IOI), and are then met with a ‘firm-up invite’ in the event of a potential match – all performed on AMP. 

The offering was said to allow users to avoid the risk of over-trading while posting the same liquidity on multiple venues simultaneously.

The post Aquis and OptimX unveil new dark trading solution appeared first on The TRADE.

Last week Aquis and Cboe announced that they were teaming up to explore a bid to become the EU’s equity consolidated tape.

Named SimpliCT, the new venture will be based in the Netherlands and co-owned by Cboe and Aquis as equal shareholders.

The endeavour would be competing with the SIX-backed initative, EuroCTP, which was first announced in the third quarter of 2023 and is backed by 14 exchanges as its shareholders.

Subsequently, SIX has said today that following completion of the acquisition, “if Aquis continues to explore or is pursuing a bid to perform the equity consolidated tape provider role, SIX intends to withdraw from EuroCTP, the consortium for the consolidated tape provider role that SIX is participating in”.

Read more: SIX agrees to acquire Aquis Exchange 

Speaking at the time SimpliCT was announced, Alasdair Haynes, chief executive of Aquis, asserted: “This proposed joint venture would not only represent a cost-efficient, robust business model that integrates advanced complementary, proprietary technologies, it would also be designed to deliver fair compensation for data contribution, aligning the interests of contributors and consumers.” 

This news from SIX around its withdrawal may come as a shock to the market as EuroCTP remains the only confirmed bidder for the European Union equities tape thus far, though others have made public their interest and potential to enter the tender process. 

Read more: European exchanges launch JV for CTP tender

Chief executive of EuroCTP Eglantine Desautel previously told The TRADE that EuroCTP is now in the process of firming up its plans to make its official bid in 2025 and has finalised the shortlisting process for its prospective technology partners and is working towards a final selection for August or September. 

The JV is made up of participants across 26 of the EU’s member states and includes: BME, Deutsche Boerse Group, Euronext exchanges (Borsa Italiana, Amsterdam, Brussels, Dublin, Lison, Paris, Oslo Børs), Luxembourg Stock Exchange, and Nasdaq exchanges (Stockholm, Copenhagen, Helsinki, Iceland, Riga, Tallinn, and Vilnius), among others.

The post SIX could withdraw from EuroCTP consortium following Aquis deal appeared first on The TRADE.

Several European exchanges are well underway with plans to bring out offerings of this ilk in the next few months The TRADE understands, while a handful of US alternative trading systems (ATS) are also preparing to make the crossing over to the Bloc to replicate the progress they have achieved in the US.

However, in light of notably low volumes and high levels of existing fragmentation, Europe now finds herself as the belle of the ball – she’s in high demand but there’s limited room on her dance card.

Innovation is, of course, always welcome and a central solution to Europe’s somewhat stunted markets – when compared with others around the world. And these venues’ approach to workflows have been hailed by institutional investors as a more stable means for institutions to get execution and remove adverse selection outside of the existing periodic auction function that has already seen success in Europe.

It is rare, for example, that you’ll find an asset manager worrying about the good of the market or how an order might influence the primary lit market share, over whether or not they have achieved the optimal outcome for their portfolio manager and end investor.

But while these players each have a niche and positive offering to bring to Europe, there will likely not be room for all of these contenders to gain meaningful traction. The real question is who will achieve first mover advantage?

A Flathead vs Philips screwdriver

The US players eager to make their debut in the pan-European markets, each bring a slightly different spin to their approach to matching trades. Each have seen success in the US, and so one can see how a move to Europe feels like a logical next step. Many of them also have Tier 1 backing which could be leveraged to gain traction with European counterparts in the future.

Eric Stockland, co-head of global electronic trading at BMO Capital Markets, explains that the venues largely fall into two categories: “It’s like a Phillips screwdriver and a Flathead screwdriver. They’re built for slightly different purposes.”

Those taking a more micro periodic auction approach include OneChronos and IntelligentCross. When trading on these venues in the US, you trade everything you’ve got at a single point in time.

IntelligentCross uses artificial intelligence to run a periodic auction model instead of traditional matching engine technology. The ATS offers both dark and lit liquidity, using machine learning to optimise price discovery.

It claims to match orders “near continuously” to achieve optimal price stability. It added intraday optimisation earlier this month – effectively allowing its midpoint matching capabilities to adapt in response to market conditions during the live trading day.

“Investors should not have to choose between liquidity and performance,” Roman Ginis, founder and chief executive of Imperative Execution, tells The TRADE. “We are always looking for ways to deliver scale and yet still minimise adverse selection and market impact.”

Alternative ATS’ that favour a trajectory crossing model include LeveL ATS, of which Nasdaq took a minority stake in 2021, PureStream (powered by Nasdaq) and Morgan Stanley’s ATS TrajectoryCrossing. Using these systems, you trade either at a rate or an average which ranges in duration.

Read more – PureStream: The disruptor venue determined to make waves in the institutional liquidity landscape

“The trajectory cross models are really important for clients whose algorithms are benchmarked to an average price over time for example like a VWAP algorithm,” explains Stockland.

“If you need to get VWAP for 100 shares or for $10,000, it’s really hard to do because you can only do that in a couple of trades. If you think of a really actively traded stock you might only get to sample price two or three times. It’s very hard to get the average but if you agree a priority to trade at an average price over some period of time you can exactly get the average.”

While not all of these venues’ moves to Europe are confirmed, PureStream and IntelligentCross are rumoured to be exploring opportunities in the region, The TRADE understands.

“Subscribers and clients have both made it clear that the unique value of Streaming in the US is something that they would welcome in Europe,” PureStream chief operating officer Sean Hoover told the TRADE. “We are excited about our partnership with Nasdaq, who has publicly announced its intent to roll out our streaming order types in Europe later this year, subject to the necessary approvals.”

A spokesperson for IntelligentCross told The TRADE it was open to European opportunities in the future but declined to comment on timelines.

Others such as OneChronos are much further along and are in the process of gaining regulatory approvals to launch in Europe and the UK. The TRADE broke the news in January that former LSEG’s Scott Bradley had been appointed chief executive officer of OneChronos’ London office, effective immediately. Alongside him, former SIX’s Adam Sherlock was appointed chief executive of the European office and head of the firm’s new European Amsterdam based MTF, effective from 1 April.

Due to launch following regulatory approval in H1 2025, the US ATS proclaims to leave speed out of the equation unlike the price time priority of existing periodic auction models. Instead, it takes dollar price improvement as its priority function.

“We are taking time as a discrete function, which is what you do when you use a periodic auction rather than continuous mechanism,” explains Bradley. “We allow market participants and their clients to compete directly on price and quantity by removing speed as a factor in execution quality, levelling the playing field for all investors.”

The ATS runs auctions roughly 10-15 times per second and then uses series of order collection, data buffer, and optimisation models. Auctions run concurrently across the universe of securities as opposed to independently timed single security auctions.

On the basis of this model, the ATS is therefore set to add ‘expressive bidding’ otherwise known as contingent trading to its arsenal in the US in the coming months. However, expansion plans for Europe will be focused on its core optimisation model for the time being, pending regulatory approval.

“You’re not treating each security in a totally isolated manner. You could for example manage a pairs trade through a periodic auction because you’re actually trading those securities at the same time,” adds Bradley.

“That is functionality launching this year in the US and so will become something available in Europe over time, however we are not looking to run before we can walk. What we are initially looking to launch in Europe will be more akin to the model in the US as it is currently today.”

The American dream

These venues have achieved success in the US and each bring innovative industry solutions to the table, however, with expansion plans brewing, the challenge now lies in gaining meaningful traction in Europe when the pie itself is not growing. Europe is not the US and achieving a 1% market share here is not akin to achieving it there.

Europe’s venue landscape is already one of the most fragmented in the world. Meanwhile rhetoric from regulators, particularly in mainland Europe, continues to encourage a push for greater volumes taking place in the lit continuous markets.

We don’t have a consolidated tape – if this is news to you then see me at the end of class – and this means for the time being any new venue looking to launch in Europe will not benefit from CT revenues. This marks a stark difference from the US where every lit venue or exchange receives a portion of revenue thanks to the best execution rule.

The elephant in the room: budget. Nothing comes for free and in pan-European markets, no one is obliged to connect to any venue. Brokers – particularly smaller ones – are continuously facing the conundrum of how to leverage new and innovation solutions brought to market while managing their technology spend.

Some are more fortunate than others in this department but for those who are not, they will simply not have the capacity to build out to all of these venues, and if they do, they risk spreading themselves too thinly across a myriad of options.

With this in mind, many could therefore take the stance that they should hang back until one or a few clear winners rise above the rest and become a fast follower. However, if all take this stance, then nothing will gain meaningful-enough traction to survive.

There is of course the option for brokers to connect to technology and OMS providers who do this connecting work on their behalf. They take in the quotes and data feeds and brokers can simply send a conditional order and look at prices. But again, this relies on said technology provider putting up the cash to build out to any or all of these new venues.

European exchanges

Enter Aquis and Cboe. While many European institutional investors are looking to the US for this much-desired trajectory crossing and upgraded periodic technology, there are developments rumoured to be taking place closer to home.

According to a source familiar with the matter, Aquis is rumoured to be launching a new TWAP and VWAP trajectory crossing capability towards the end of this year. Aquis declined to comment on the launch. Meanwhile, Cboe is also rumoured to have a crossing launch in the pipeline.

“The benefit that we have with new services is our long track record of success with orderbook innovation, and closely partnering with clients during the development process,” Natan Tiefenbrun, president of North American and European equities at Cboe, tells The TRADE.

“We deliver new services that clients want, on time and we make it as easy as possible from a technology perspective for these services to be adopted. We have built up a strong level of trust and support from clients which is a real source of competitive advantage to us when it comes to new product launches.”

When asked to comment on any new services in the pipeline, Cboe declined to comment.

While these offerings will not be a carbon copy of what the US ATS’ intend to bring over, one can see the appeal of leveraging an existing connection with an exchange partner to access said technology instead of having to fork out for new ones.

With all of these players now vying for the attention of institutional investors, it is likely that the early bird will catch the worm and some newer players may struggle to make inroads. Players such as OneChronos are expected to arrive in Europe in 2025 but with European players preparing to throw their hat into the ring before that, we could see a chunk of flow hoovered up before their boots touch the ground.

Cboe’s periodic auction is the beneficiary of said tactics and now dominates the market in Europe. April was an all-time record for Cboe’s periodic auctions across both average daily volume at just over £2.1 billion and market share which accounted for 6.3% of total continuous trading in European equities.

“Undeniably there’s an advantage to being first but that advantage is not insurmountable,” says Stockland. “The folks could come in and quote that slightly novel improved twist on the workflow. Workflow really matters in this business. It could come in and compete better on price.”

“It’s a big advantage to going first but I don’t think it will thwart others and it doesn’t preclude them from ultimately overtaking and becoming number one. Look at Cboe, they were upstart ATS 15/20 years ago and they dominate pan-European trading today.”

Private rooms

An interesting element of the US players is their capabilities with ‘private’ or ‘hosted’ rooms and whether or not this could be translated into their potential future European workflow. In the US, the use of private rooms – a not too distant cousin of Europe’s former Broker Crossing Networks (BCNs) – is prevalent amongst institutional players.

The option is available to participants who do not have the budget or technological or regulatory capability to run a venue but that are looking to interact with select number of firms. IntelligentCross runs this functionality and OneChronos is about to launch it in the US, The TRADE understands.

OneChronos’ offering is called Nexus and allows clients to create bespoke periodic auctions to trade with a select number of counterparties.

Fragmented liquidity has become a hot topic in European discussions and sparked some heated on-stage debate at recent conferences. BCNs were scrapped as part of Mifid II in order to make markets more compliant and push more volumes onto lit continuous markets.

However, increasingly bilateral and fragmented forms of interaction are becoming more popular in Europe despite rhetoric around the damaging impact they have on the primary markets. It’s an interesting one to watch, especially considering the potential for any venues that operate using this model to move over to Europe.

“There may be certain features which may be able to find their way into the European landscape,” says Bradley. 

“If you think about the trading that happens within SIs currently, there’s clearly an appetite for certain forms of bilateral execution but a straight translation from ATS private room into MTF would not meet regulatory requirements as is. What it does suggest is that there is an appetite to think about new dynamics of counterparty interaction.”

The landscape of periodic auction and trajectory crossing networks in Europe is set to flourish over the coming remainder of the year. Despite Europe’s volumes being low, these venues offer greater choice and competition for institutional investors looking to achieve optimal outcomes which could in itself go some way to boosting stats in Europe. While not all will be successful, some definitely will. In this instance, it’s likely the one that takes top spot will be the one that gets there first. Innovation will prevail.

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Data and technology saw 24% and 22% growth to £3.7 million and £6.3 million respectively, pushing Aquis’ net revenues for the year up 13% to £22.7 million.

The exchanges markets business also saw  7% growth to £10.9 million for the year.

Market share had grown from 4.97% in December last year to 5.46% in February. Aquis attributed the growth in market share to changes to its proprietary trading rule in September.

“We can now get to 10% market share and we can become a top three player. We knew that over time that [lifting the ban on proprietary trading] was the right thing to do and the market share would increase. The way that we operated by having non-client proprietary flow in effect banned from taking the spread meant the proprietary traders were not participating aggressively in our platform,” Haynes told The TRADE. 

“That meant the time to execution was slower on us than any other platform. And, it was very clear in talking to the banks specifically that they wanted much quicker time to execution. Interestingly enough, prior to the rule change 18% of our passive flow was provided by the banks. Post-rule change, 41% of our passive flow is bank flow.”

Aquis linked its technology growth to the two new contracts it was awarded last year – the most recent being for the Colombian government bond market. Aquis Technology has nine contracts, seven of which have recognised revenue.

“It is a unique product. There is a total accessible market of about 350 exchanges out there. We’ve done nine contracts, seven of which have revenue recognition,” explains Haynes. “Over the medium term, we should be able to obtain 5-10%, even 20%. When you look at the cash flow as a result of that it materially changes this company.”

“We are literally the only company in the world in this cloud space. Exchanges central banks they want modernised technology and they can’t just leave their data centres right now but they do know over the next 5-10 years that they will almost certainly go to cloud based technology in some way and we could hand hold him in that process.”

The exchange confirmed at the beginning of this month that it was set to begin charging its trading members for non-displayed market data feeds for the first time since its inception almost 11 years ago.

According to a member notice distributed on Friday 1 March, members on both Aquis Exchange and Aquis Exchange Europe will have to pay the same monthly rate as non-members for non-displayed data effective 1 June 2024. Non-display and terminal fees are now applicable to trading members, the notice confirmed.

The post Aquis sees double digit growth on the back of data and technology boom appeared first on The TRADE.

David Stevens

Speaking to The TRADE, David Stevens, chief operating officer, asserted: “The introduction of conditionals is an exciting step for Aquis and one which progresses our block trading functionality, along with the future collaboration with OptimX that we announced at the end of 2023.”

In practise, members using the functionality send an ‘indication of interest’ (IOI), subsequently met with a ‘firm-up invite’ in the event of a potential match.

Users have a 300 millisecond time limit to proceed with the trade and accept the invite. Trades will take place on Aquis’ dark pool – Aquis Matching Pool. 

The offering allows users to avoid the risk of over-trading while posting the same liquidity on multiple venues simultaneously.

There is the opportunity to set a minimum execution size as well as specifying whether to limit execution against only those order which meet the large-in-scale (LIS) criteria.

“The addition of conditional orders to our UK and EU platforms is an important extension to AMP, the Aquis dark pool, and means that the exchange now offers a full suite of key trading mechanisms – allowing our customers access to liquidity in a broad range of trading scenarios,” said Stevens.

Back in August 2023, Aquis Exchange expanded its block crossing remit with a minority stake in US-based equities block trading start-up OptimX Markets.

The acquisition, completed as part of a consortium which also includes the venture capital arm of Deutsche Boerse Group, DB1 Ventures, was at the time earmarked to support this expansion into conditional block trading and crossing.

Aquis members are able to elect either a ‘regular’ conditional order, which can match with AMP liquidity or other conditional orders, or they will be able to choose for the order to also interact with clients of OptimX.

Speaking at the time, Jonathan Clelland, Aquis’ chief operating officer, explained: “This has been something in the making for quite a while. It’s part of Aquis’ developed strategy. We added the dark pool last year, then we added the dark lit order sweep. This is the next step, putting conditionals in, because clients want that capability […] Aquis will develop its conditionals alongside its other products and then when OptimX Markets is ready to go live with banks and institutions on blocks, they will work with us as we’re a logical partner in terms of their execution.”

The post Aquis Markets unveils conditional order functionality on UK and EU platforms appeared first on The TRADE.

Speaking to The TRADE, Adrian Ip, managing director at Aquis Technologies, said: “We are pleased to be the first regulated exchange in a major jurisdiction to adopt pure cloud for the matching engine, but we fully expect to see other exchanges follow suit.

“The wealth of benefits provided by the cloud, including its scalable capacity, infrastructural resilience and cost efficiency savings make migration to the cloud a compelling alternative to traditional on-premise solutions.”

All Aquis Stock Exchange trades are now being matched and executed successfully while running on Amazon Web Services (AWS) as of 27 November.

Alasdair Haynes

Alasdair Haynes, chief executive at Aquis Exchange, highlighted how this step fits into the business’ strategy: “This latest development further highlights the focus on innovation within the Group and represents an additional step in the execution of the Aquis Technologies strategy. The cloud-based matching engine enables the business to deliver transformation across the exchange space globally through the application of its cutting-edge, institutional-grade technology.” 

The key benefits of the adoption include scalable capacity, cost saving, reduction in the exchange’s environmental footprint, increased infrastructure resilience, flexibility and speed of response times.

In April Aquis launched Aquis Equinox – the world’s first 24/7 matching engine and has previously also completed a proof of concept with AWS and the Singapore Exchange.

Brian Cassin, head market development for capital markets at AWS, said: “By running on AWS, the Aquis Stock Exchange is driving transformation across the capital markets industry while continuing to enhance the scalability, functionality and innovation that will benefit its members and stakeholders in an environment where security and resiliency are our highest priority.”

“We will continue to build on the experience Aquis has in creating and facilitating next-generation financial markets with the reliability, global presence, and security of AWS to help Aquis continue to expand and seamlessly transact billions of dollars in trades per day.”

The post Aquis Stock Exchange first to adopt cloud-based matching engine appeared first on The TRADE.

Drew Vincent is set to join TD Cowen in an execution services role following almost 15 years at Credit Suisse. During his tenure, Vincent held various positions across Credit Suisse, most recently as head of AES sales trading, based in London. He also worked on the client coverage team of Credit Suisse’s agency electronic trading platform, Europe, focused on bespoke execution consulting and strategies. In his most recent position, Vincent led a team of sales traders, overseeing the restructured coverage in the aftermath of Brexit, as well as managing the review and deployment of algorithms and implementing T-1 related changes for business operations.

Aquis exchange chief operating officer Jonathan Clelland is set to depart next April, with chief revenue officer and head of Aquis Markets David Stevens appointed to replace him. Prior to joining Aquis, Clelland was chief operating officer at HSBC Investment Bank corporate finance division and of Shearman & Sterling in London. Clelland will remain as a special advisor in order to “ensure a smooth transition”. Stevens joined Aquis in 2021 and had previously held various senior roles across financial services and technology. His past positions included chief executive of foreign exchange broker Global Reach Group, as well as senior roles at Investment Technology Group, JP Morgan and Goldman Sachs.

Twelve individuals were appointed to lead UBS’ business across various areas as it restructures its operations. In the vertical global product pillars, Adrian Bracher was appointed to lead macro structured solutions (rates and FX), having joined UBS this month. Ramzi Issa was named structured credit and sustainable credit products lead, joining the business in November, as is Julien Bieren, soon to lead equity structured solutions. Also in the vertical restructure is Guilio Alfinito, appointed to lead QIS structuring, and Richard Walters, new lead of fund derivatives and structured finance solutions. Under the horizontal set-up, Romain Barba will join the business in November toco-lead APAC structuring alongside Ahmad Chaudry, while Chris Cook will head up Americas structuring. In addition, Erica Yeu will lead wealth management solutions, while Ahmad Chaudry leads wrapping solutions and Hannah Vinci oversees strategic products. Spyros Mesomeris, in addition to his global role, will head up EMEA structuring.

Investec named Paul Moss as its newest equity sales trader following three and a half years at Goldman Sachs. Moss has an established focus on global emerging markets, having worked across various jurisdictions within his roles. He has held various positions across the industry, most recently as CEEMEA (Central Europe, Middle East, and Africa) equity sales trader at Goldman Sachs. Before that we worked in a range of roles at Citi, most recently as pan Asia equity sales trader.

Instinet appointed Christopher Brown as executive director, latency sensitive electronic trading (LSET). Brown joined from JP Morgan where he spent nearly four years as executive director of quantitative investment strategies (QIS). Prior to that, Brown spent almost 3 years at Citi as director of systemic and quant trading solutions. Before joining Citi, Brown served as director, autobahn equity sales and trading, low latency DMA at Deutsche Bank. Elsewhere in his career, Brown held senior position at FIX Protocol, Chi-East and Instinet – the latter being his first tenure at the firm in 2009.

MUFG appointed Daniel Sbroocca in a credit trading position, joining from BNP Paribas where he spent almost nine years. While at BNP Paribas, Sbrocca most recently served as an emerging markets credit trader – a position he held for two years. Previously, Sbrocca held an emerging markets credit sales position at the firm. Elsewhere in his tenure at BNP Parabis, Sbrocca served in a corporate rates sales role for Northern Europe.

Wells Fargo appointed Jon Thorne as senior securities sales trading specialist, joining from Credit Suisse, where he spent 13 and a half years. Most recently, Thorne served as a listed sales trader – a position he held for almost 11 years. Elsewhere during his tenure at Credit Suisse, Thorne worked in a FX and futures execution position as well as a FX prime brokerage role. Before joining Credit Suisse, Thorne held an eFX and prime brokerage FX position at Commerzbank AG. Prior to that, he held the same role at Dresdner Kleinwort.

The post People Moves Monday: SIX, TD Cowen, Aquis and more… appeared first on The TRADE.

Prior to joining Aquis, Clelland was chief operating officer at HSBC Investment Bank corporate finance division and of Shearman & Sterling in London. 

Stevens’ new role is effective as of today with Clelland remaining as a special advisor in order to “ensure a smooth transition”.

Stevens joined Aquis in 2021 and had previously held various senior roles across financial services and technology. His past positions included chief executive of foreign exchange broker Global Reach Group, as well as senior roles at Investment Technology Group, JP Morgan and Goldman Sachs.

Speaking in an announcement, Alasdair Haynes, chief executive of Aquis, praised Clelland’s important role at the business since the exchange’s inception, as well as his expert guidance.

“Jonathan has had a profound influence on Aquis since our inception, having played an integral role in building the finance and operations functions of our business and ensuring we have a solid team in place for the delivery of our strategy.” 

Haynes also shared his congratulations for Stevens: “Since joining in May 2021, David has helped ensure continued revenue growth and diversification across the business. He commences his new role with this vital experience and Group-wide insight, and I look forward to continuing our fantastic work to date.”

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The Aquis markets division delivered strong results, following on from the integration of Aquis Matching Pool last year, with revenues spurred on by the diversification of the business, Alasdair Haynes, chief executive of Aquis, told The TRADE.

“If we look at Aquis Markets, what we’ve seen is a decline in the market as a whole of around just over 20% in lit trading and a lot of people focus on market share […] But I think the fact that we grew our revenues because we diversified that business is really satisfying.

“We made the decision a couple of years ago to move away from just the one thing that we did and now we have a closing auction, periodic auctions, the Aquis matching pools, a change to our proprietary trading rules – we’re really opening up the business to have access to the whole market, rather than different segments of the market and it’s been very pleasing to see that the diversification has paid off.”

Read more: Aquis Exchange acquires minority stake in US block trading start-up OptimX Markets

Aquis markets currently holds a 5.1% market share, which Haynes said was a number which he’d like to see continue to grow, expected to be boosted significantly in the medium term as a result of continued diversification.

Notably, last week Aquis Exchange relaxed its ban on proprietary or non-client firms on its UK and EU trading platforms, set to allow access for more aggressive proprietary trading firms. Following the implementation of the new regime in Q4, the exchange will allow these entities to interact with members that have opted in to trade against them.

Concentrating on the execution of this new rule is a main priority for Aquis going forward, The TRADE understands, with customer testing a key focus.

The business also reported overall profit across the other three areas of its business: data, stock exchange, and technologies.

Aquis data saw a 34% increase in revenues, with expectations that this will continue on its upward trajectory as consolidated tapes (CT) – both in the UK and the EU – come to fruition. 

Speaking to The TRADE, Haynes highlighted that the progress of CTs is expected to disproportionately benefit Aquis: “We do not charge our members data fees, members of the Aquis exchange get free data […] For us the consolidated tape means we will get revenue where we’re not getting any revenue today, so our members would no longer get this for free because it’s out of our control.” 

He added: “It’s now not a question of ‘if’ we get a consolidated tape, which it’s been for years, it is a matter of ‘when’. I think we’re two to three years away.” 

Addressing the technology side of the business, Haynes highlighted the success of the contract pipeline.

Speaking in an announcement, he said: “Our Aquis Technologies contract pipeline has continued to develop as expected, with a renewal and an extension over the period demonstrating the long-term nature of these relationships.” 

He told The TRADE that Aquis Equinox – the worlds first 24/7 matching engine – launched in Q1 had put the business on the map: “The great thing about 24/7 is the economic benefit […] without any loss of performance and that is the thing that is most appealing. We think that that is not just suitable for the financial service industry but longer term this could be used outside of financial services.

“We feel very much the leaders in cloud 24/7 exchange technology.”

Elsewhere, the Aquis Stock Exchange welcomed five new listings throughout the period, less than half compared to the 12 in H122, which the business stated was reflective of a general slowdown in IPO activity.

Despite this, the business has stated that it remains positive on the long-term performance for the exchange – which has remained profitable in the first half of 2023 despite challenging market conditions.

Speaking to the overall results, Haynes told The TRADE: “We are absolutely in line with market expectations, we’re in line with our board expectations […] we’re comfortable with what the analysts are predicting us to make and where we are today.

“It’s an exciting time for us, in the five years we’ve never missed a number […] even in difficult market conditions we’ve been able to put out a really good set of results where you see all four business divisions grow and you see revenue growing in each one. The future looks bright for us even in these poor conditions.”

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The deal, announced on Monday 7 August, was completed as part of a consortium which also includes the venture capital arm of Deutsche Boerse Group, DB1 Ventures.

Jonathan Clelland

According to the terms of the acquisition, the investment has been split into two tranches, payable in cash. As part of the first, Aquis will subscribe $750,000 out of a total first tranche of $3 million.

The second tranche in a year’s time will include a further $750,000 out of a total $3 million.

The deal will support Aquis’ expansion into conditional block trading and crossing, with further plans for Aquis to add conditional orders to its markets in the fourth quarter.

Aquis’ chief operating officer, Jonathan Clelland, is expected to join the board of OptimX Markets.

“This has been something in the making for quite a while. It’s part of Aquis’ developed strategy. We added the dark pool last year, then we added the dark lit order sweep. This is the next step, putting conditionals in, because clients want that capability,” Clelland told The TRADE.

OptimX Markets will build out their own platform which is currently equities only and un-regulated.

“Conditionals will be launched by Aquis later this year and that opens up the opportunity of going into the block business,” Clelland added. “Aquis will develop its conditionals alongside its other products and then when OptimX Markets is ready to go live with banks and institutions on blocks, they will work with us as we’re a logical partner in terms of their execution.”

The deal and the expansion into blocks compliments Aquis’ existing dark pool business, the Aquis Matching Pool (AMP). Formerly UBS MTF, Aquis assumed responsibility for its business activities in March 2022. The exchange has since been building on the offering, launching Dark to Lit Sweep functionality Aquis UK and Aquis EU markets in June.

“The investment in OptimX is a significant opportunity for Aquis, adding additional connectivity to our successful dark pool (the Aquis Matching Pool) and providing clients with the ability to cross large blocks,” said Aquis chief executive officer, Alasdair Hayne, in a statement. “This alongside Aquis’s growing functionality will further enhance the range of execution options available to our members.”

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