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Liquidnet
Liquidnet claims to be one of the world ’ s largest pure agency brokers in its provider questionnaire . With over 1000 clients globally , it supports the majority of core algorithms , with the exception of dynamic close .
Overall , Liquidnet has scored just below the average , with an overall score of 5.70 . However , there are several areas where it outperforms , in particular breadth of dark pools ( 6.02 ) and reduced market impact ( 5.96 ). Contributing to this score is Liquidnet ’ s claim to have “ narrowly missed the arrival mid-point by -1.9bps and beat the estimated market impact by 19.7bps in 2023 ”. However , it is worth noting that traders may not be so impressed by this , as they were last year given that this category fell 0.14 since 2023 .
It is worth noting that when it comes to largest shift since last year , both execution consulting and pre-trade cost as well as flexibility and sophistication of smart order routing have seen an upward movement of 0.25 . However , execution consulting and pre-trade cost just takes the top
spot , with an overall number of 0.2517 vs flexibility and sophistication of smart order routing having an overall total of 0.2501 .
This increase in score for flexibility and sophistication of smart order routing may be due to Liquidnet ’ s awareness of asset managers shift to multi-asset class trading . In light of this , they are looking to create liquidity across asset classes , and not just source liquidity and trade at the best price .
However , there are significant areas in which Liquidnet needs to improve . When it comes to cost , speed , customisation features , ease of use and algo monitoring , it has landed in the bottom three for each of these categories .
The majority of respondents are based in the UK ( 39 %), Europe ( 34 %) and the US ( 21 %), with 28 % of respondents holding AUMs of $ 50bn or more .
It is also worth noting that only 15 % of traders are looking to make use of additional trading providers over the next 12 months , with Jefferies looking like the most popular choice .
LIQUIDNET RATINGS FOR ALGORITHMIC PERFORMANCE
Increased trader productivity |
Reduced market impact |
Execution consistency |
Cost Speed Anonymity Price improvement Customisation |
5.85 5.96 5.79 5.46 5.69 5.85 5.77 5.31
Ease of use |
Order routing logic / analysis |
Customer support |
Execution consulting |
Dark pool access |
Flexibility and sophistication of SOR |
Algo monitoring |
Average score |
5.79 5.54 5.82 5.51 6.02 5.71 5.41 5.70
KEY STATS Overall Outperformer : NO Category Outperformer : X3
6.02 Highest score
( Breadth dark pools )
|
5.31
Lowest score ( Customisation features )
|
0.25
Most improved ( Ex consulting and pre-trade cost )
|
-0.14
Least improved ( Breadth dark pools )
|
|
|
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Issue 79 // thetradenews . com // 87 |