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The AX Trading Network, the new electronic trading community for trading smallcap stocks, today announced that in February its members conducted over 200 unique auctions on The AX. This number does not count multiple auctions in the same stock on the same day. The average "Initiated" order size of those auctions was 83,000 shares, meaning that there were 17.3 million shares of liquidity put up for auction on The AX.
Of the 207 auctions on The AX, 28 of those auctions attracted at least one "Participant" order, resulting in a "Participation Rate" of 13.5%.
17 auctions resulted in a successful match between buyers and sellers, a "Success Rate" of 8.2%. The average cross size was 32,500 shares. This means that more than 1 million shares traded on The AX in February.
While obviously this is not a lot of volume in the context of the overall market, it is more impressive in terms of the tough-to-trade stocks that have been put up for auction on The AX. The average market cap of stocks on The AX in February was $930 million and the average ADV was 401,000 shares. This means that our average Initiated order size represented more than 20% of the ADV. The AX continues to build its reputation as the destination for orders that exceed 20% of ADV.
AX is experiencing increased adoption and is setting month-to-month records. The AX trading community continued to grow in February. The AX trading community now has over 650 buy side traders set up to receive AX alerts when auctions kick off in names in which they have flagged interest. This represents approximately 58% of the long-only investment community (based on AUM) and 26% of the hedge fund community.
“We believe the trader-initiated call auction is an excellent vehicle for sourcing liquidity in tough-to-trade situations,” said AX CEO Kevin Callahan. “The February numbers show that traders are willing to embrace this new model.”
