EQUITIES
BLOCK TRADING - HOW WILL EUROPEAN BLOCK
TRADING BE AFFECTED IN MIFID II/MIFIR?
Exchanges driven block services will gain more
traction
More LIS block transactions will be traded at
Multilateral Trading Facilities (MTFs)
I expect to increase my use of "conditional orders"
I expect to find more block liquidity through
continuous and/or periodic auctions
I suspect that the buy-side may change trading
behaviours to trade more algorithmically fragmented
orders as a means to prevent market impact
It will make it more interesting for me to deal with
agency brokers based on riskless principle
I suspect the price for block liquidity will raise due to
limited availability
I will need to employ the banks 'block service
specialists' to get my trades done
I doubt the Systematic Internaliser (SI) regime will
work and it will severely impact the amount of block
trading opportunities I will pass to brokers.
Buy-side will be encouraged to adapt a VWAP as their
performance benchmark instead of Implementation
Shortfall
Care will be needed when your order crosses from LIS
to below LIS
0
10
20
30
40
50
Responses
True
False
Don't know
Source: K&KGC The Buy-side Perspectives /// Buy-side Equities survey 201 7
43 buy side responses
Winter 2017
www.buysideintel.com
21