Equity futures TCA has many similarities with other asset classes but there are also some key differences. Within equity futures, there is a centralised exchange, deep order books and excellent liquidity in most contracts. Unlike equities, there is no fragmentation across multiple venues and price transparency is less of an issue compared to some other asset classes or instruments. The futures market also engages in rolls which is uniquely measured from a TCA perspective. Pre-trade, market impact and peer models are not as common and can be less detailed compared to equities and this is an area which might benefit from more investment by vendors and brokers alike.

In terms of similarities, the same benchmarks are used to measure performance versus other asset classes, such as IS, IVWAP, TWAP and open/close snaps, with the latter focusing on the equity cash times. Algo wheels within futures are now in full flow with similar structures to their equity counterparts, albeit with potential contract size nuances.

How has the use of TCA in the asset class evolved over the years?

Equity futures TCA has developed meaningfully over the last 20 years, as has been seen with other asset classes. Historically, the focus was on explicit costs, such as exchange fees and commissions, rather than implicit cost measurement. As with other TCA improvements in recent years, that has evolved to include analysis which can provide actionable conclusions.

Market data has improved, and internal order data has become more accurate with the recording of several different order lifecycle timestamps. This led to increased use of TCA benchmarking.

The rise in electronic trading supported more granular order data availability. The current age of increased automation in all areas of the industry has led to more efficient trade handling, more accurate market data and subsequent performance analytics. Market data vendors have been able to remove un-addressable blocks, as well as delayed prints and rolls, to ensure performance is calculated on liquidity which is addressable. Given the infancy of pre-trade and market impact models for equity futures, it’s still lagging equities in terms of available analytics, however that has improved significantly.

What should be front of mind for firms when it comes to building effective, workable equity futures TCA capabilities?

With any analytics framework construction, it’s vital that the market and order data being used is accurate, leading to actionable insights and conclusions. TCA results depend on the quality of order instruction tagging, which can vary significantly. For example, classifying roll orders will improve the efficiency of separating them out and suitably measuring this flow. The ability to measure performance versus each point in the order lifecycle allows information to be provided to portfolio managers and traders on any glaring issues such as delay costs and order profiling. As a result, being able to access this data via an O/EMS allows for a more detailed analysis.

Engaging with the trading desk on the most appropriate methodology for equity futures TCA measurement is essential as they will have specific knowledge of the market structure, which can enhance the analytical framework and resulting conclusions. Splitting results into various categories can highlight underperforming areas to be investigated. When flow is significant, the use of TCA vendors is advantageous. This includes algo wheel orders where contextual market data is provided such as spreads, volatilities, liquidity, and market momentum. These can then be used to normalise slippages versus market conditions, to treat brokers/algos fairly.

How can these tools be improved to best measure trading performance?

Order tagging could benefit from being more consistent in accuracy and population, rather than applying blanket instructions to orders. Even if portfolio managers interact with the trading desk in the office or via messaging services, the resulting TCA performances can only be driven by the quality of tagging available in the datasets.

Pre-trade and market impact models for equity futures are available but can lag their equity counterparts. Investment into these areas by TCA vendors and brokers could therefore distinguish them amongst their peers.

Algo wheel customisations are already available in the market, however they often take a while to complete. This is an area where improvements would again push vendors significantly above competitors.

The post The evolving role of transaction cost analysis in equity futures trading appeared first on The TRADE.

Hinmon has a career history that spans nearly four decades, with the last 10 years spent at her current firm. Originally joining Glenmede in 2015 as an equity trader, she took on her role heading up the buy-side firm’s equities trading business in 2017.

Originally joining the industry as a runner on the trading floor of NYSE Chicago – formerly known as the Midwest Stock Exchange, her career was nothing short of a baptism of fire, igniting a passion for the markets that would lead to her current seat today.

“It was electrifying [seeing] the energy people had and the interest in the companies where stocks were trading. I ran to the bookstore within the first week of working on the exchange and I bought books on the market like ‘Inside the Fed’ and ‘a Barron’s guide to financial definitions’, and I just ate it all up,” she explains.

“S&P used to publish this tiny thing called a tear guide, and the paper was super thin, like airmail paper. I managed to get my hands on one and I took it home over the weekend and I memorised every stock ticker and which specialist traded it on the floor, and what post they were at so I could come armed and know exactly where to run a ticket to or from.

“The more interested I became, the more people became interested in me because I started asking questions.”

Not all traders will have the opportunity to witness the exhilaration of an open outcry trading floor during their career. In the past, the majority of trading has taken place in-person on a trading floor where traders in the flesh would buy and sell throughout the course of the day, and where runners – such as Hinmon – would run between them delivering tickets.

However, given the rising prowess of technology in trading, the way markets today operate has changed beyond recognition. Importantly, stresses Hinmon, so too has the way that traders feel markets and the methods that they use to anticipate movements. With greater electronification and fragmentation, it is sometimes harder to see the entire picture and this poses a new challenge for those starting out in the industry.

“It [activity on the trading floor] was like a freight train coming. You could feel the rumbling in the tracks. Especially on the New York floor, you can hear the footsteps,” she says.

“You could feel the vibration of people walking faster, and you can hear the momentum pick up. It was really fascinating to me because then your ears would perk up and you’re thinking ‘what do I need to pay attention to?’ ‘What’s happening right now?’ Now, you lose that continuity. It’s all machine-driven. There was a certain psychology that you could feel when people moved that markets lack now.”

Mentors

Hinmon stresses the importance of mentors when asked what has had the greatest impact on her career to date. It’s these relationships that have led her to her current seat, driven by her own desire to keeping asking questions and learning. It was when she was first working on the Midwest floor that she began to become interested in other areas of the markets.

“I went to the head of derivatives and said, ‘could you please explain to me why you’re trading this stock and what it is for?’ He ended up having me come over for an hour a week to sit with his team to learn what he did and why.

“Relevance is important in any business but even more so with the shifts that we see in ours and the constant changes with regulation, product, algorithms, exchanges and trading venues. You have to understand how they function, why they function and what’s the best route for you and your team to accomplish what your portfolio managers’ goals are.

“What may be important last week is less important this week. It may be on the front burner and then that flame goes out. It’s a game of chess.”

Cultivating and respecting relationships is a key mantra she suggests all new traders should follow. When asked what other tips and tricks she would recommend to those starting out in the trading industry, Hinmon highlights some of the most important lessons she’s learnt are remaining fluid, rolling with the punches and learning to admit when you’re wrong.

“Young traders have to recognise that the market is bigger than you are. You have to be willing to admit when you’re wrong. We’ve lived through a lot of different crises. The flash crash, the great financial crisis, Brexit, Russia, and looking back one thing you realise is just as markets don’t go up forever, they don’t go down forever,” she explains.

“If there’s been one thing I’ve learnt, it is that markets recover. They are living, breathing creatures. They have peaks and valleys. Don’t get too rattled when we have drawdowns in the market. Own up to your mistakes and learn from them. I had some pretty big errors back in the day. Whether it was a matter of trying to be too quick on something or flat out doing something wrong, own up to it and learn from it. People respect you more when you do that.”

US fragmentation

Hinmon, who sits on both the SIP and CAT (Consolidated Audit Trail) advisory boards among others, took home the Buy-side Market Structure Expert of the Year Award at Leaders in Trading New York 2024 after multiple industry nominations by peers and clients. The Philadelphia-based director of equity trading confirms she is increasingly keeping tabs on market fragmentation in the US. This, she explains, is one of the market structure themes having the greatest impact on the US equities landscape today.

Fragmentation is no new phenomena in Europe which has three times the number of exchanges as the US, 10 times the number of listing venues and 20 times as many post-trade providers and is an issue that comes up time and time again in the ongoing debate around the health of the liquidity landscape in the region.

Read more – The TRADE announces Leaders in Trading New York 2024 award winners

However, as noted by Hinmon and other market structure specialists, thanks to the launch of new national exchanges, the proliferation of private rooms within venues and the growth of the single dealer, bilateral and off-exchange segments, the US market has become fragmented to the point that many market structure experts are keeping a watchful eye to see how it further develops.

Private rooms have taken off in the US in the last year. Currently the concept – whereby a venue offers a select number of participants the opportunity to create a closed pool where they can interact with one another – is not permitted under EU regulation. However, in the US, as the number of venues increases, so too does the opportunity to fragment things further through more private rooms.

“What will the consequences be of the launch of the four or five new national exchanges?” asks Hinmon. “We already have 16. What does it look like if we have 21? That’s a big deal. It’s something that hasn’t been corrected in years.”

In making her point, the director of equity trading quotes several market structure sell-side partners that have all published data in recent months unpacking the ongoing theme of fragmentation, and what is and is not addressable for US traders.

Among the names is Jenny Hadiaris at Citi. According to Hadiaris, just over 25% of total market volume in the US in 2024 was addressable single-stock liquidity for institutional investors if ETF, sub $5 stock, market making and some wholesale retail activity is removed from the equation.

“It needs to be corrected. I don’t know what the solution is. If I could come up with the solution, I’d probably be able to retire tomorrow,” says Hinmon.

The increased fragmentation is also causing trading flow to become increasingly siloed to a certain number of asset managers dependant on where certain relationships lie, and this is contributing to changes in the buy-side competitive landscape.

“At some point in time, we’re going to be left with maybe eight or nine asset managers in the country. Is that really what we want? The market is becoming increasingly fragmented through bilateral trading agreements the proliferation of private rooms and single dealer platforms. If a select few are getting access to liquidity that others are not, how can we really say there is price discovery in our markets?”

The issue, Hinmon highlights, is the lack of transparency in the US as new venues and forms of trading continuously expand the competitive landscape. If volumes are becoming increasingly siloed into less transparent corners of the market that often do not print on the SIP, traders are faced with a greater challenge when looking to be executed in the market.

Data released by Jefferies’ Anna Kurzrok in a market note to clients found that in November last year, off-exchange volume exceeded 50% on 12 out of the 20 trading days, and on almost all of the trading days in December.

Segmented markets mean there is often less liquidity than an institutional trader might think, posing a challenge for those trying to navigate the execution of their orders. When exploring the growing off-exchange and bilateral segments, Hinmon highlights that this trend is not limited to smaller retail flow.

Quoting data released by Nasdaq’s Phil Mackintosh, she explains that looking at all stocks in the Russell 3000 Index, very few now have off-exchange share below 30%. In fact, the majority are now seeing off-exchange trading range between 40%-50% regardless of stock price or market cap.

When asked what the institutional buy-side can do to navigate this increasingly complex and shrouded landscape, Hinmon confirms that her team rely heavily on their transaction cost analysis (TCA) both internally and externally.

The situation is likely only set to be exacerbated by recent developments in the US that will see equities move to a 24 hour, five day a week model. There are several platform providers such as OTC Markets and Blue Ocean Technologies offering after hours US trading but in recent months the US market has also seen moves from central venues such as NYSE, Cboe, and Nasdaq, all looking to expand some or all of their equities books onto an extended trading hours model.

While the moves have glaring positives such as increased flexibility on trading and greater exposure to other regions around the world, an extended trading period for equities also poses some questions around transparency, operations and retail. Questions that those sitting in Hinmon’s seat must now begin to assess as the markets evolve further.

“What’s that [24/5 equities trading] going to look like?” asks Hinmon. “I can’t imagine institutions are going to be playing that. What’s the advantages for retail playing that? Is it going to cause additional retail fragmentation. Is retail participation going to be elevated?”

Other market structure developments Hinmon is keeping tabs on include the potential for the new administration to do away with the order protection rule (OPR), the expansion of institutional cryptocurrency trading, and whether the US Securities and Exchange Commission (SEC) is going to approve exemptive relief for ETF mutual fund classes.

While there are many potential plates spinning, Hinmon explains that she and many like her are for the time being waiting for the dust to settle following the election in November and subsequent change in administration in the US that took place at the start of this year.

Hinmon, like many in her trade, has learnt that success in this industry follows adaptability. While market structure and regulatory change in the US is currently somewhat dormant, it’s more than likely that with the change of administration witnessed at the start of this year, there is scope for a wide breadth of changes to be made that will echo through North America and into the markets globally. For those less clued up than Hinmon, it’ll likely be a bumpy ride.

The post Building success in a fragmented US appeared first on The TRADE.

This overlapping distinction has been attributed to the rise of electronic execution for program trades and the increasingly sophisticated algorithms for single-stock trading, which represent a greater shift towards e-trading. 

According to a study conducted by Coalition Greenwich, program trades accounted for approximately $79 billion in daily trading activity in 2024, and nearly half (46%) of these trades were executed electronically, an increase of 35% in two years.  

The firm has said that buy-siders leveraging existing single-stock algorithms instead of implementing program-specific strategies has also contributed to this increase.   

“Today’s traditional single-stock algorithms are savvy are enough to be used to execute baskets of orders as single programs,” said Jesse Forster, head of equity market structure and technology at Coalition Greenwich. 

“Between workflow innovation and good old-fashion inflation, the definition of program trading itself is now in flux.” 

This push towards electronic execution and advanced algorithms has meant that there is a greater buy-side focus on the choice between high-touch and low-touch execution, with the aim of finding the method with the best trade outcome.  

Many buy-side traders use broker sales traders to offer guidance on these options, and for more than 60% of them, performance and minimising market impact are the driving force in the decision-making process.  

Forster added: “While electronic trading is becoming more prevalent, high-touch sales traders still play a vital role in program trading, particularly for complex orders or those involving non-U.S. constituents. 

“Buy-side traders value the expertise and risk management capabilities of high-touch sales traders.” 

Although this growth in the program trading space may offer challenges to smaller or regional brokers competing with larger banks, it is expected that many firms will build on this development and begin innovation and investments in next-generation program-specific strategies.  

The post Algo advances create overlap between US equities’ single-stock and program trading appeared first on The TRADE.

Speaking at a Bloomberg Intelligence market structure conference on Wednesday, Alex Dalley, head of European cash equities at Cboe, confirmed that the venue had processed more than a trillion message events on its options market in the US earlier in the week, a clear sign of the intense market activity. 

Read more – The TRADE predictions series 2024: Market volatility

When it comes to the current state of play on desks themselves, the buy-side wants to buy, but the sell-side doesn’t want to sell, one trader tells The TRADE – a sentence not often heard across the industry.

Reportedly, the sell-side are going flat, not shorting or blocking and instead sitting in a bid to protect their book. Simultaneously, on the buy-side traders are trying to find opportunities in a barren landscape. 

Notably, recent BMLL data examining the impact of the US tariffs on market structure and how people traded showed a dramatic fall in the time that orders are resting on the book before being filled.

BMLL explained that “the same dramatic reduction is seen across Europe (~35 seconds to ~6) and the US (~25 seconds to ~7), reflecting the global impact of the tariffs,” as players look to rapidly execute volume.

When it comes to strategy, it’s difficult to blame the sell-side for this approach of protecting their books, especially given the fact that the buy-side generally has a longer-term view on trades.

One sell-side trader echoes this, confirming that instructions have been clear on the desk to keep risk very low, with instances of not showing prices to the ‘wrong’ types of clients due to the opacity of the current landscape.

Despite this, several across the street have used to current state of turmoil following the US to reinforce the importance of relationships – in particular in times of high volatility.

Though technological innovation is on an upwards trajectory with no sign of slowing down and traders’ roles continue to change, recent events have demonstrably made clear that this human touch factor is unlikely to go extinct.

Read more – The desk of the future: ‘AI conductors’ vs the traditional trader?

One trader concurs, explaining that there is a clear, unavoidable difference in rejecting an electronic order and saying no directly to an individual, explaining that in some recent instances, where the firm perhaps wouldn’t usually have said yes to a price, they have for a specific client – even if considered a loss.

For the buy-side, it’s hard to criticise why the other side aren’t meeting them – conscious that it’s an opportunity and thus have no real motivation to sell. It comes down to the simple fact that if the sell-side don’t have a view on something they simply will not price it, says one trader.

Demonstrably, when the market panics, nobody wants to take a side because of the fact it can so easily move in either direction. Of course, that does nothing to comfort clients who are more cognisant than ever of the importance of their managers’ roles in the current climate. 

The market volatility is also true of trading strategies themselves, with day to day and intraday activities swinging dramatically, The TRADE understands.

One source confirms that certain days in the past week have been completely risk off, with things changing radically just a day later, with yesterday’s sellers becoming today’s buyers – and struggling on both counts in many instances. 

Clearly, the situation is akin to a waiting game, at least for now, with desks on tenterhooks as concerns US decision making.

Another source confirms the reality of the buy-side is selling, explaining that though of course these firms are prepped to absorb some losses, some assets which have traditionally been used to hedge are no longer perhaps as viable as once before. 

The message of course being clear – that we may be entering a pivot era away from US exceptionalism and the consideration of the region as a safe haven.

As Charles Younes, deputy CIO at FE fundinfo explained on Wednesday: “We recently moved from an overweight to an underweight position on US equities, and the latest market developments have reinforced that decision. The equity sell-off has now extended into the bond market, with US Treasuries selling off overnight and the US dollar also under pressure.”

“US assets – long viewed as global safe havens – are now being repriced as sentiment deteriorates. This is not about fundamentals, which remain broadly intact, but about rising uncertainty and diminished visibility. Investors are increasingly demanding a premium to hold US-based assets.

“[…] In this environment, we believe a more defensive posture is not only prudent but necessary.”

Fake news

On Monday, the markets were sent into a tailspin as an unverified report that the US president was planning a 90-day pause on proposed tariffs momentarily sent stocks shooting back up.

One trader tells The TRADE that everything started rolling and continued to for around 20 minutes with those trading jumping in and starting to buy before realising the lack of validity of the claims. 

With the market at its most sensitive, some names have been hammered by this incident, with some hedge funds taking the opportunity to fish for assets.

The original source was put down to a misunderstanding – though some reputable financial news services had already reported, fuelling the fire of the chaos. 

Following the reports, Karoline Leavitt, the White House’s press secretary confirmed that it was “fake news”.

Demonstrably, as capital continues to rotate globally, there’s much more yet to come…

Speaking to The TRADE, Nandini Sukumar, chief executive of the World Federation of Exchanges, highlighted that the industry can expect this instability to continue for the foreseeable.

“It’s a time of great volatility, but that’s what public markets are here for: to allow investors to take a view on the global economy, political directives, and geopolitics, and to manage their risk effectively. In times like this, the operational resilience of market infrastructure really proves its worth. Things will continue to be volatile until we have clarity.”

The post Buy- and sell-side in stand-off as US tariffs waiting game continues appeared first on The TRADE.

SimCorp and TS Imagine initially partnered in 2017 and recently combined their products to offer an integrated, multi-asset class solution for asset managers – with SimCorp One users now having access to TS Imagine’s fixed income trade execution capabilities. 

Specifically, MEAG is now live on TS Imagine’s fixed income execution management system (EMS). 

Elke Wenzler, head of trading at MEAG, explained: “The decision to implement TradeSmart EMS was initially driven by MEAG’s multi-asset class trading desk requirement for a unified execution platform that could effectively handle both fixed income and exchange-traded instruments.

“This objective has now been achieved, and we are benefiting from the enhanced workflow efficiencies, expanding liquidity access and improved trader productivity that the strategic partnership between SimCorp and TS Imagine has facilitated and continues to refine.”

Read more: MEAG’s Elke Wenzler on the next generation trading desk

MEAG is now able to access TS Imagine’s fixed income execution tools, data, analytics and liquidity network, whilst maintaining continuing to operate on SimCorp One – the integrated, front-to-back investment platform.

Marc Schröter, chief product officer at SimCorp, said: “We are pleased to have expanded our partnership with TS Imagine as one of SimCorp’s key partners in the EMS space to provide asset managers like MEAG with seamless access to their fixed income trade execution capabilities within SimCorp One. 

“Since our partnership started in 2017, we have consistently enhanced our integration to improve front-office user experience and workflow automation, enabling mutual clients to optimise their investment operations.”

The post MEAG to leverage SimCorp, TS Imagine offering to streamline trading desk execution appeared first on The TRADE.

Flynn has been with Fidelity since 2016 when she joined as an equities trader for EMEA.

“Georgina Flynn has informed us she will be leaving Fidelity International to spend more time with her family,” said a Fidelity spokesperson.

“We thank her for her contribution to the business over the last eight and a half years and wish her every success for the future.”

Flynn has an extensive career to date in trading, having spent the last eight and a half years at Fidelity.

Prior to joining Fidelity, she spent four and a half years at Merrill Lynch as a pan-European sales trader following an internship at the bank.

Previously in her career, she also undertook a sales trading internship at Sanford C. Bernstein.

Flynn’s departure comes amid a string of moves at Fidelity International in the last few weeks.

Notable moves include the departure of equity trader Dominic Eccles who is set to return to Federated Hermes after two years, and head of debt capital markets for EMEA, Stephen Whyman, who is leaving Fidelity after seven years to pursue another “entrepreneurial path”.

The post Senior Fidelity equities trader departs appeared first on The TRADE.

According to an update on his social media, Stephen Whyman is leaving Fidelity after seven years to pursue another “entrepreneurial path”.

“Leaving Fidelity has been one of the hardest decisions I’ve made, but I feel the time is right to pursue a more entrepreneurial path outside of the company,” he said in his update.

“I am deeply grateful for the opportunities I’ve had whilst here and I hope I can find similarly rewarding challenges outside.”

The new entrepreneurial path is unconfirmed. 

“Stephen Wyman has decided to leave the company to pursue other career opportunities,” a Fidelity International spokesperson confirmed. “We’d like to thank him for his service to Fidelity International.”

Whyman has been with Fidelity International since 2018 where he joined as a senior fixed income trader. He assumed his most recent role as head of debt capital markets for EMEA in 2022.

He originally joined Fidelity from BlackRock where he had been operating as an emerging markets fixed income trader.

Previously in his career, he also spent three years at ABN AMRO N.V in emerging markets roles and two and a half years at Bear Stearns International Trading.

In his update on social media on Thursday, Whyman thanked his colleagues with special mentions of portfolio strategies senior director, Andrew Falco, head of fixed income trading, Lars Salmon, and global chief administrative officer for asset management, Maria Abbonizio.

The post Fidelity International’s Stephen Whyman departs after seven years appeared first on The TRADE.

Market structure changes, particularly regulatory reforms like Mifid I and, more specifically for ETFs, Mifid II, have significantly reshaped the European ETF trading landscape. Mifid II disrupted the dominance of traditional stock exchanges by opening the door for alternative trading venues, increasing competition, and expanding investor choice. However, this democratisation has also led to market fragmentation, with ETF trading now spread across multiple platforms and exchanges.

In Europe, multilateral trading facilities (MTFs) have emerged as key players. These MTFs can make execution quicker, potentially more efficient, and transparent, giving liquidity providers access to streamlined trading and offering clients pre-trade pricing transparency. At the same time, the emphasis on ‘best execution’ has driven more complex and fragmented market structures, with many algorithms now ready to help capture fair value trading via all lit, dark exchange executing venues. All aiming to ensure investors fully leverage the ETF wrapper’s trading characteristics for better trading outcomes wherever they choose to execute.

What’s next for the ETF landscape, particularly in fixed income?

The ETF market continues to expand at a rapid rate, and there are some exciting trends shaping its future. One of the most significant growth areas is within fixed income. For me this is where the ETF wrapper has created real structural change. Unlike stock markets, which have well-known centralised exchanges (e.g., LSE, NYSE, NASDAQ, etc.), the bond market operates differently. There is no single centralised exchange for bonds. Instead, bond trading occurs primarily in decentralised, over the counter (OTC) markets.

ETFs have indirectly evolved this market structure, taking an opaque over the counter market and successfully placing this on the same well-known exchanges around the world. ETFs’ success in evolving this market structure has created more price discovery within the fixed income asset class that has become evident after recent stressed market periods. This price discovery and execution transparency for fund assets is something only possible with the ETF wrapper. For this and more we believe the ETF wrapper will become mainstream for both passive and active fixed income pooled investment.

How does ETF activity differ between the US and the UK, and how do they interact?

In the US, about 70% of ETF trading happens on exchanges, while 30% is over the counter. In Europe, including the UK, it’s the opposite: 70% of trading is OTC, and only 30% is on exchanges. The US is the global leader in ETFs, with around 4,000 ETFs and about $10 trillion in assets, making up 70% of the global total. Europe, including the UK, has about 3,800 ETFs with $2.4 trillion in assets, which accounts for 16% of the global total. The US dominates ETF trading volume, handling over 80% of total global ETF trades, while Europe accounts for just 6%.

However, European ETFs grew faster than the US market in 2024, with a 33% increase in assets under management compared to a slower growth rate in the US. Despite this, ETFs still make up a smaller part of the retail investment market in Europe compared to the US, where retail investors play a more active role in ETF trading.

What are the nuances of how ETFs are, and will be, traded?

There are a few different strategies for trading ETFs, each with its own pros and cons. You’ve got NAV trading, risk trading, and agency/algorithmic trading. Some key tips for trading ETFs include knowing the best time to trade, considering your trade objective, choosing the right order type, and making sure ETF is trading close to its fair value.

ETFs can be traded on various venues, directly with brokers, or OTC via the MTFs mentioned earlier. This trading and liquidity flexibility is again a key catalyst for further investor ETF adoption, as many traders and investors continue to look for differentiating approaches to portfolio construction, execution and risk management.

How does ETF liquidity perform during times of market stress?

During periods of market stress, ETF liquidity can be a critical lifeline for investors. The structure of ETFs, which allows for continuous trading and relies on market makers to maintain liquidity, enables them to function even when underlying markets face pressure.

A prime example of this occurred during the pandemic in March 2020, when global markets experienced significant turmoil. While underlying bond markets became illiquid, fixed-income ETFs continued to trade actively on secondary markets, despite trading at record discounts to their net asset values (NAVs). This demonstrated the resilience of ETFs, as they provided investors with access to liquidity and price discovery when traditional markets froze.

The role of market makers and the ability of ETFs to aggregate liquidity across a basket of securities were key factors in their ability to remain functional during the crisis, solidifying their importance as a reliable tool for navigating market uncertainty.

The post Fireside Friday with… Franklin Templeton Investments’ Jason Xavier appeared first on The TRADE.

McLoughlin declined to comment when approached by The TRADE.

His departure follows news broken by The TRADE in January that Liontrust was exploring outsourcing its trading to BNY.

While it is not yet confirmed what the final agreement will be, it appears the setup will at the least be focused on covering non-UK activity.

“As part of our ongoing commitment to enhancing operational efficiency, it is proposed to deepen our strategic relationship with BNY by using its Buyside Trading Solutions for our trading capabilities,” said Liontrust in a trading update released at the time.

McLoughlin originally joined Liontrust in 2015 as a senior trader before working his way up through the ranks to become head of trading in 2016. He assumed his most recent role as chief commercial officer in 2023, responsible for overseeing the development of commercial strategies of the Group as well as maintaining oversight of the trading desk.

Martin Hendry, who had been part of firm’s multi-asset desk for the last six and a half years, assumed the role of deputy head of trading when McLoughlin joined Liontrust’s C-suite in 2023.

During his tenure, McLoughlin co-led a redesign of the firm’s operating model, integrating a cloud-native data architecture while automating a significant portion of multi-asset execution, and implementing an upgraded trading and investment platform.

Industry stalwart McLoughlin has an extensive career history in trading, having previously served as a global equity and derivatives trader at Legal & General Investment Management (LGIM) for a year and as a senior trader at RAB Capital for five and a half years.

He currently serves on the board of directors at Plato Partnership.

McLoughlin was recognised as one of The TRADE’s Rising Stars of Trading and Execution in 2016. Under his stewardship, Liontrust was awarded The TRADE’s Multi-Asset Trading Desk of the Year and Mid-Cap Trading Desk of the Year in 2022 and 2017 respectively.

Liontrust’s multi-asset desk was also nominated for the Multi-Asset Trading Desk of the Year at Leaders in Trading 2024.

During McLoughlin’s time with Liontrust, the asset manager grew from $4 billion in AUM to a peak of $50 billion across a global, multi asset platform.

He also co-led a redesign of the firm’s operating model, integrating a cloud-native data architecture, automating its multi-asset execution, and implementing a new trading and investment platform.

As reported by The TRADE earlier this month, Maddy Davies swapped Liontrust for BlackRock following almost two years as a trader within the asset manager’s multi-asset trading team.

Last year, Davies was recognised as one of The TRADE’s Rising Stars of Trading and Execution 2024. Davies joined the firm from Northern Trust in July 2023, where she had spent two years working across various departments.

The post Industry stalwart Matt McLoughlin and Liontrust part ways appeared first on The TRADE.

George Rosenberger

Named NYFIX Algo Co-Pilot, the new product uses AI to build a picture of fils in the market to better inform traders when they look to select an algorithmic strategy, all in a bid to reduce the implicit cost of trading. Broadridge has partnered with Babelfish.com to power the AI element and Google for the cloud requirements.

“This is the first time we’re really seeing AI in practice in trading. Everyone’s talking about use cases but here’s a scenario where it actually works,” says George Rosenberger, general manager of NYFIX, Broadridge, speaking to The TRADE at the FIX EMEA Trading Conference 2025.

“Implicit costs are 85% of the cost of trading. Our goal is to reduce that implicit cost of trading by using these recommendations based on our understanding of how brokers source liquidity from each strategy. We’re using AI to look at all of the dark fils that are going off in the market.”

The co-pilot segments algo offerings in liquidity buckets based on the correlation of how specific securities trade. Within each bucket, it ranks the broker algos based on historical near time performance.

“Think of it like sonar for ships. It takes physical things to figure out a location,” explains Rosenberger.

“It’s the same with dark pools. You can’t see the liquidity but when there is a fil we know the broker and the dark pool it came from. We use AI to match that information up with prints on the tape. With 90% precision we’re able to say what fil came from which dark pool so we know how much liquidity is sitting there.”

The new product will initially float beside the buy-side OMS, however Broadridge plans to integrate it like a blotter in the future – when a trader clicks on a strategy it’ll automatically launch the algo ticket in the OMS.

Unlike an algo wheel or switching engine, the offering will only inform traders as opposed to making a recommendation or automatically routing to a particular broker.

The offering will also monitor changes in the market and update information for the trader accordingly so they can change strategies if necessary.

“Algo wheels are prescriptive and have static rules. This [NYFIX Algo Co-Pilot] allows the buy-side to dynamically make changes based on what is going on in the market,” says Rosenberger.

“We are not making the recommendation on which broker to route an algo to, we are just informing to the buy-side of the choices that they have – this is the optimal strategy for the name they’re trading but ultimately it’s the buy-side directing the order.”

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