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London, Nov 19, 2009 (ABN Newswire) - London Stock Exchange (LON:LSE) announces that it will introduce a new order-driven trading service for bonds. This new electronic order book will be available for a select number of gilts and UK corporate bonds and will offer private investors with an on-screen secondary market in London-listed debt securities for the first time. This new service is expected to go live in February next year.
Pietro Poletto, Head of Fixed Income for London Stock Exchange Group, said:
"London is a global centre for the listing and trading of debt, and in the current climate of low interest rates and equity market volatility, the retail appetite for bonds has increased substantially. This new initiative aims to meet that demand by offering private investors exposure to this market for the first time through transparent, efficient access to fixed income securities listed in the UK.
"London Stock Exchange Group's 'MOT' market operated by Borsa Italiana is the most liquid and most heavily traded retail fixed income platform in Europe. We are delighted to offer the established benefits of this model to retail investors in the UK."
Over 10,000 debt securities are already admitted to the London Stock Exchange but the vast majority are currently available for trade reporting only.
The main characteristics of the new trading service are:
- An electronic order-driven model, with retail-friendly order sizes, and continuous two-way trading provided by market makers.
- Two new segments for electronically tradable gilt-edged securities (UK Gilts) and electronically tradable UK fixed interest securities (UK Corporates) will be introduced on London Stock Exchange Group's TradElect trading system.
- The trading day will be made up of an initial opening auction phase followed by continuous trading until market close. There will be no closing auction.
- All order book trades in securities admitted to the new segments will settle in CREST. Routing of trade information to Euroclear UK & Ireland will be carried out by London Stock Exchange Group's post-trade router, X-TRM.
The new trading service is not expected to impact existing wholesale bond or gilt trading and trade reporting arrangements and does not aim to change established practices in the institutional fixed income markets.
Pietro Poletto, Head of Fixed Income for London Stock Exchange Group, said:
"London is a global centre for the listing and trading of debt, and in the current climate of low interest rates and equity market volatility, the retail appetite for bonds has increased substantially. This new initiative aims to meet that demand by offering private investors exposure to this market for the first time through transparent, efficient access to fixed income securities listed in the UK.
"London Stock Exchange Group's 'MOT' market operated by Borsa Italiana is the most liquid and most heavily traded retail fixed income platform in Europe. We are delighted to offer the established benefits of this model to retail investors in the UK."
Over 10,000 debt securities are already admitted to the London Stock Exchange but the vast majority are currently available for trade reporting only.
The main characteristics of the new trading service are:
- An electronic order-driven model, with retail-friendly order sizes, and continuous two-way trading provided by market makers.
- Two new segments for electronically tradable gilt-edged securities (UK Gilts) and electronically tradable UK fixed interest securities (UK Corporates) will be introduced on London Stock Exchange Group's TradElect trading system.
- The trading day will be made up of an initial opening auction phase followed by continuous trading until market close. There will be no closing auction.
- All order book trades in securities admitted to the new segments will settle in CREST. Routing of trade information to Euroclear UK & Ireland will be carried out by London Stock Exchange Group's post-trade router, X-TRM.
The new trading service is not expected to impact existing wholesale bond or gilt trading and trade reporting arrangements and does not aim to change established practices in the institutional fixed income markets.
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About London Stock Exchange Group plc
London Stock Exchange Group (LON:LSE)(PINK:LDNXF) sits at the heart of the world's financial community. The Group operates a broad range of international equity, bond and derivatives markets, including London Stock Exchange; Borsa Italiana; MTS, Europe's leading fixed income market; and Turquoise, offering UK and Russian derivatives trading, pan-European and US lit and dark equity trading. Through its markets, the Group offers international business unrivalled access to Europe's capital markets.
The Group is a leading developer of high performance trading platforms and capital markets software and also offers its customers around the world access to an extensive range of real-time and reference data products and market-leading post-trade services. The Group is also home to a world leading index provider FTSE, which creates and manages of over 200,000 equity, bond and alternative asset class indices.
Headquartered in London, United Kingdom with significant operations in Italy and Sri Lanka, the Group employs around 1,850 people.
Further information on London Stock Exchange Group can be found at http://www.londonstockexchangegroup.com/
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