The new trading platforms that compete against established exchanges to match orders are having a clear and profound impact on the European trading landscape. Chi-X, the first of a growing number of pan-European MTF to have launched since the EU’s Markets in Financial Instruments Directive (Mifid) came into effect, now regularly handles more than 15% of the total volume of FTSE 100 shares traded, while Turquoise, a rival MTF initiated by a group of investment banks that launched in August, has already captured almost 5% of that market.
The investment banks that have been the driving force behind these platforms are thrilled. Analysts estimate that the amount that banks have invested in such platforms is already dwarfed by the amount they have saved through lower exchange fees. Citi recently said that it now does more than half its trades on Chi-X and Turquoise.
"Equity trading in Europe is...
