AX Trading launches electronic trading network.
BANKING AND CREDIT NEWS-December 15, 2015-AX Trading launches electronic trading network
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AX Trading today said it has launched the AX Trading Network, a new electronic trading network or ETN that allows institutional traders to target and trade with selected counterparties in a secure environment.
The AX ETN restores primacy to institutional traders and helps improve trade quality. As an ETN or electronic trading network, AX is all about buyside trader access to liquidity, price discovery and control of order information. AX addresses many current difficulties associated with exchanges and dark pools.
AX allows traders to designate a time and place to trade a particular security--effectively calling those other counterparties to the market. To do this, AX operates on a new trading model--a callable auction. One institutional trader, a liquidity seeker, routes an order to AX. They do this via a sponsored broker of the AX ATS. The order then kicks off a five minute call auction and triggers the distribution of electronic AX alerts to targeted recipients. The initiator of the AX auction has control over both the content and distribution of those alerts.
Responders or participants in the AX auction can route orders to AX to participate in the auction. At the end of the auction, the AX system performs a match -- not just a midpoint match -- but a true auction finding the clearing price (inside or outside the NBBO) that results in the largest trade. Post-auction, orders can remain at AX--either resting in the dark or working in the market -- while still available for crossing should responders arrive after the auction ends.
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