Liquidnet

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Liquidnet Inc.
Liquidnetlogo.gif
Founded 2001
Headquarters New York
Key People Seth Merrin, Founder and CEO
Products institutional brokerage
Website www.liquidnet.com

Liquidnet is an electronic marketplace for block trading, serving institutional clients in 43 markets globally. The firm enables buy-side firms to access the largest natural pool of institutional liquidity in the industry, and it allows them to execute institutional-sized orders directly and anonymously.[1] Liquidnet's average execution size is 40,000 shares, or 100 times the industry average.

Liquidnet offers a variety of trading strategies, which traders can access through its Web-based interface, MultiVerse By Liquidnet, through FIX, or through Liquidnet’s trading desk. From 2012-2014, the company has been named the top broker in the world for equities trading by trade analytics firm Abel/Noser.

On June 18, 2015, Liquidnet announced plans to launch a dark pool for corporate bonds in the third quarter of 2015, in addition to its existing institutional-only dark pool for equities. The bond platform will also be focused on institutional investors. Liquidnet has already signed up seven order management system (OMS) providers to offer day-one access.[2]


History

Liquidnet was founded by Seth Merrin in 2001.[3]

On June 8, 2009, Liquidnet announced a partnership with NYSE Euronext, a competitor, to launch new services for interactions between institutional investors and corporate issuers serviced by both organizations. Liquidnet said it would launch Liquidnet InfraRed, a proprietary desktop application accessed through NYSE’s ‘NYSEnet’ system to aggregate institutional demand, news sentiment and block trading data.[4]

On Jan. 27, 2010, Liquidnet announced it had been ranked as the number one overall performance leader for the second consecutive year in U.S. Equities Operations by Z/Yen’s 2009 survey of Operational Performance of Brokers.[5]

On March 8, 2010, Liquidnet announced that they had integrated its electronic trading services directly into Fidessa’s EMS Workstation to boost block trading execution capabilities. The joint opportunity will provide Fidessa customers seamless access to Liquidnet's pool of block liquidity for the equity markets. [6]

In January 2011, Liquidnet announced a partnership with SIX Swiss Exchange, the first time an exchange and a trading venue that operates dark trading have teamed up. The arrangement allows the Swiss exchange to offer large-size institutional trading, while also catering to high-speed trading firms that trade in much smaller increments on its main platform. [7]

In March of 2014, Liquidnet acquired the UK bond trading platform Vega-Chi, marking its first move beyond equities and into the fixed-income market. Vega-Chi operates electronic platforms for convertible bonds and high-yield debt in Europe and the US. Liquidnet's CEO Seth Merrin said Vega-Chi would initially operate separately from Liquidnet's core equities business. The company plans to launch trading in corporate bonds in the US in October 2014, before rolling it out in Europe in early 2015. [8] [9] In a September 2014 CNBC interview, founder Seth Merrin further explained the firm's rationale for expansion into the corporate bond market.[10]

In April 2014, the firm began offering trading in Indian equities, bringing its global reach to 43 markets.[11]

Liquidnet was sanctioned by securities regulators in 2014 for not living up to client secrecy standards on its private trading platform. The company settled the allegations by paying a $2 million fine to the SEC.[12]

In December 2015 Liquidnet launched its first electronic trading algorithm into the Asian equity markets, in Hong Kong and Japan. The firm first entered the Saian equity market back in 2007. A full suite of services is set to launch in 2016.[13]

In March of 2016 Liquidnet chose Societe Generale as its clearer in Europe after the closure of its previous clearing provider, JP Morgan. [14]

Patents

In June 2010, the Patent and Trademark Office awarded Liquidnet its second United States patent related to its equity trading system. Liquidnet was issued U.S. Patent No. 7,747,515 for "Electronic Securities Marketplace Having Integration With Order Management Systems." The patent further protects Liquidnet’s proprietary computer-based methods for generating liquidity for institutional block trades. Liquidnet was previously issued U.S. Patent No. 7,136,834 in November 2006.[15]

Key People

References

  1. Dark Pool Directory. AdvancedTrading.
  2. Liquidnet unveils plans for bond dark pool. The Trade.
  3. Liquidnet confirms Vega-Chi tie-up. Financial News.
  4. Liquidnet Announces Partnership with NYSE Euronext to Launch New Services to Uniquely Connect Institutional Investors with Corporate Issuers. NYSE.
  5. Liquidnet Voted #1 for Operations in Annual Broker Survey. Liquidnet.
  6. Liquidnet Partners With Fidessa On Block Trading. Wall Street and Technology.
  7. Liquidnet appoints Patrick Young to Board. Financial News.
  8. Liquidnet poised for fixed income trading platform launch. The Financial Times.
  9. Liquidnet confirms Vega-Chi tie-up. Financial News.
  10. Liquidnet: How we're expanding into bonds. CNBC.
  11. LIQUIDNET POSTS RECORD QUARTER IN ASIA PACIFIC ON SURGING DEMAND FOR SAFE, BLOCK LIQUIDITY. Liquidnet.
  12. Liquidnet cuts about 6% of Staff Citing Struggling U.S. Market. Bloomberg.
  13. Liquidnet launches first algorithm for Asian traders. Traders Magazine.
  14. Liquidnet picks SocGen as European clearer. Financial News.
  15. Liquidnet Awarded Second U.S. Patent for Its Innovative Equity Trading System. Liquidnet.