Squawker has completed their initial European launch with great success, according to this morning's press release. The sell-side block negotiation platform is the world's first to exclude algorithms and high frequency trading, driven by negotiation and interaction through private chats.
The platform aims to address the problem of block trades in the order books by acting as a middle man in a community of vetted buyers and sellers. According to the release, these include "tier-1 investment banks, regional tier-1s, traditional agency brokers, sell-side transition managers, private banks as well as niche sell-side firms across Europe." Given specific criteria by the sellers, Squawker finds the counterparts likely to engage with the trade, and sets up anonymous private chats for negotiations that generate FIX messages and reports.
The initial roll-out across Europe signed 70-sell side firms across 13 European countries, all ready to negotiate. Squawker's CEO Chris Gregory also announced they are currently on-boarding another 30 firms, and have 20 more committed to connect through November and December. In total, Squawker expects 100 firms in the community by year-end.
"Squawker is not a dark pool so we do not “own” the volumes that are traded through us," explains Gregory in an e-mail. "Each firm owns their on volumes that they execute through Squawker. So when each firm does a trade on Squawker, they advertise their volumes on Bloomberg IIRA, they send out FIX trade adverts and they do the trade reports in their own name."
"We are growing fast in Europe and plan to explore expanding into North America and Asia Pacific in 2014," he adds. "We have had a number of customers ask about Squawker providing trading in US equities. Squawker provides a unique solution that is not another dark pool, nor another order book and from the feedback from participants, Squawker would be as useful to sell-side firms for US equity trading as it is for European equity trading."
As for its current reach, the press release says the majority of the Squawker community today is based in London, and more than 50% of Nordic firms live on Squawker.
"With the additional Nordic firms currently on-boarding, the Squawker community very soon will encompass more than 80% of all Nordic sell-side firms. Our success in Germany to date, has been with the larger German firms, so by November, Squawker will give access to around 50% of sell-side liquidity represented by flow in Germany.”