Barclays today confirmed the firm’s commitment to reporting volumes in its dark pool, LX, on a monthly basis, emphasizing its belief that transparency benefits the overall industry.
“Our commitment to reporting volumes and other aggregate details about LX underscores Barclays’ belief that transparency is not only important, but that it benefits both our clients and the market overall,” stated Bill White, Head of Equities Electronic Trading in the firm’s announcement. “As the equities market structure continues to evolve, our belief is that more transparency will assist clients in finding natural sources of liquidity and allow them to make more informed decisions on their trading.”
In April 2013, LX reported an average daily volume of 99 million shares, representing $6.6 billion in average daily notional value traded, Barclays disclosed. In March, LX had ADV of 89 million shares, according to Rosenblatt Securities.
The move by Barclays comes a month after Credit Suisse, operator of CrossFinder, the largest institutional equity dark pool, decided to no longer report monthly volumes to Tabb Group and Rosenblatt Securities. The news sparked stories about Credit Suisse going dark which would impact the accuracy of volume reports by the two monitoring firms.
[For more on Credit Suisse No Longer Reporting Dark Pool Volumes, Takes Away from Transparency , see Ivy Schmerken's related story.] In January, Barclays LX moved up in the rankings to become the second largest U.S. equity dark pool, according to Rosenblatt.
[For more on Dark Pools Grab Market Share – Rosenblatt Report, see Ivy Schmerken's related story.]
Barclays said the commitment to report volumes in LX follows several other initiatives introduced in recent years to promote transparency and help clients make informed decisions. The firm cited 5 initiatives including:
• Liquidity Profiling in LX: Introduced in January 2012, Liquidity Profiling allows Barclays to evaluate each client’s trading in LX based on quantitative factors,thereby providing more accurate assessments of aggressive, neutral and passive trading strategies. Clients can then choose which trading styles they interact with, instead of choosing by the more arbitrary designation of client type.
• LX reporting to clients: Using the quantitative metrics from Liquidity Profiling and Barclays’ in-house transaction cost analysis tools, clients can receive regular reports on their trading performance in LX.
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio