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Mismi Inc. Develops New ATS with Portfolio-Level Controls

Dark pool will allow traders to set constraints and execute lists through the crossing network.

In a sign that the universe of alternative trading systems continues to expand, Mismi Inc., a start-up based in New York-City, is developing a new equities crossing network that enables the buy-side to put portfolio level controls on their trading.

Based in the Wall Street area, Mismi Inc. is forming an independent agency broker that will operate the matching engine as an ATS. The new dark pool to be called Mismi ATS, is named after a mountain peak in Peru where the glacier that starts the Amazon River is located, explains Andrew Papandreadis, CEO of Mismi, who founded the company about a year-and-a half ago and has received venture capital backing from its lead investor TL Ventures, based in Philadelphia, and Saturn Partners in Boston.

While most crossing networks and dark pools operate in a single stock trading world, Mismi hopes to meet the needs of portfolio managers that want to control the way their portfolio executes.

The company is a spin off of Axioma, a developer of investment management software whose target clients are portfolio managers. Papandreadis came up with the idea for Mismi by drawing on what he learned about portfolio construction at Axioma, and what he observed at Instinet where he ran the technology side of the crossing business until 2002. In the early days, the crossing networks had low match rates of 8-to-10 percent.

"I realize that portfolio managers are setting out to build portfolios, yet traders set out to trade single names. We need to enable some of the decision factors that portfolio managers consider every day find to their way onto the trading desks," says Papandreadis.

Mismi ATS is geared to buy and sell-side traders, according to the CEO. While quantitative portfolio managers are a natural fit for the dark pool, sell-side firms that build intelligent baskets "As long as you can combine a strategic objective with an underlying portfolio, you're a natural participant in Mismi," he says.

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

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