Provides independent access to U.S. equity options and cash equities markets
Newedge Group (“Newedge”), a global leader in multi-asset brokerage and clearing, announced today the launch of Phase 2 of their Smart Order Router (SOR) platform for U.S. equity options and cash equities products. This new in-house, low-latency routing platform is now open to executing market participants – including small- and mid-sized registered broker dealers, market makers, exchanges and high frequency traders – providing independent, best execution and superior price discovery. The announcement was made during the annual Futures Industry Association (FIA) conference in Boca Raton, the preeminent meeting of derivatives industry market professionals.
The platform, which was made available in Q3 of 2011 for market participants who cleared through Newedge (Phase 1), provides high-speed, efficient execution through direct access to major options exchanges, including: International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), NYSE Amex/NYSE Arca and the Boston Options Exchange (BOX), among others.
“This platform scans a large, diverse amount of data and then determines the optimal destination for every order,” said Jack Boyle, senior director, Financial Futures & Options and Equities Execution (FFO&E) at Newedge. “The SOR considers price, depth of quote, historical liquidity, fill rates, latency and price discovery, among other factors and routes the order to the venue of least cost, providing clients with the best price.”
Complementing the router’s technical capabilities is a newly formed Newedge Best Execution Committee, whose role is to examine daily reports that monitor the routing logic to ensure it is being executed properly and to respond immediately to needs of market users.
During the Phase 1, the Newedge SOR averaged over two million cash equity shares and approximately 25,000 equity option contracts per day.
“Since Newedge does not operate a proprietary trading desk, the Newedge SOR will now provide all of our clients with an alternative, independent solution in which to efficiently trade cash equity and equity option products,” says John Ruskin, Global head of FFO&E at Newedge. “By opening access to more market participants with the launch of Phase 2, we believe that volume and liquidity on the platform will only increase and ultimately benefit the overall market.”
