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Instinet, a global agency broker, today announced the 20th anniversary of the industry’s first crossing network, which Instinet launched on December 16, 1986. To mark the occasion, the firm intends to donate the commissions generated from its LDXSM (Last Daily Cross) during the week of January 8, 2007, the first full trading week after the holiday season, to the MDA’s Wings Over Wall Street®, a charitable organization which funds research for Amyotrophic Lateral Sclerosis (ALS), also known as Lou Gehrig’s disease.
“Instinet takes great pride in the innovations we’ve been fortunate enough to introduce to the market, particularly in the crossing space,” said Edward J. Nicoll, Instinet CEO. “Over the past 20 years, alternative execution venues like ours have benefited investors worldwide by creating efficient, anonymous marketplaces, and we’re pleased to commemorate the occasion by giving to such a worthwhile organization.”
Now known as LDX, Instinet’s end-of-day cross allows clients to anonymously match shares at known end-ofday prices with zero market impact. This trading approach is now employed by over 30 trading systems in the U.S. alone, according to research firm TowerGroup.
Since introducing the end-of-day crossing system, Instinet has developed its VWAP Cross, which matches orders before the market open and later executes at that day’s volume weighted average price, and its IDX SM (Intraday Cross), which matches orders three times each day at market mid-spread prices. Combined, Instinet’s three U.S. crosses execute over 30 million shares a day, on average.
Instinet has also been a pioneer in the international crossing space. Instinet’s JapanCrossingSM is Asia’s only alternative trading system. A PTS-licensed (proprietary trading system) system, JapanCrossing’s three daily crosses allow users to trade Japanese equities, particularly illiquid names, in an anonymous, safe and neutral venue. Its liquidity pool has grown steadily, representing 3.9 percent of the TSE’s total daily turnover in Q1 2006. Additionally, Instinet is also in the process of introducing continuous, electronic crossing systems in both Europe and Canada. Chi-X, a pan-European MTF (Multi-Lateral Trading Facility), is currently in live testing, while ICX (Instinet Canada Cross) is expected to launch in 2007.
