Instinet’s JapanCrossing crossing network and CBX dark liquidity pool are at present the only active alternative trading venues to the Tokyo Stock Exchange. JapanCrossing runs scheduled matches several times a day, while CBX is a continuous matching system that runs on the same platform as Chi-X, the pan-European ATS launched by Instinet last year.
Although neither has yet posed a serious threat to the TSE, increasing frustration with the exchange’s technology, which last year suffered embarrassing glitches, has acted as a catalyst, helping to quadruple volumes on JapanCrossing to 2% of the TSE total.
“JapanCrossing has been running since 2001,” says John Fay, co-CEO of Instinet, “but it has taken a long time to sell the message of better execution to domestic firms because there is no history or experience of alternative trading venues.
Real liquidity
“We started by making inroads with foreign firms but the real liquidity in Japan is with the domestic...
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