Liquidnet’s Top Five Predictions for the Global Equity Markets in 2013
Liquidnet Celebrates Milestone Anniversaries in Europe and Asia Pacific
NEW YORK -- December 19, 2012
As Liquidnet, the global institutional trading network, celebrates its 10 year
anniversary in Europe and five year anniversary in the Asia Pacific region,
Liquidnet provides their top five predictions for the markets globally in
Five Predictions for 2013
1. Inflationary pressures coupled with a prolonged low interest rate
environment and falling bond yields will bring equities back into vogue. As a
result, trading volumes will continue to recover. What remains to be seen,
however, is whether primary markets recover some of their market share; in our
view, the trend towards disintermediation will continue throughout 2013.
2. As the impact of HFT continues to affect the cost of institutional trading,
institutional investors will take a more active role in their choice of
execution venues and turn to venues which meet their specific needs – those
that provide deep liquidity in an HFT-free zone. Regulators and exchanges
around the world, responding to investor pressures will begin the discussions
around whether to – and how to – implement high frequency free trading zones
within their markets.
3. Amid increasing competition from low cost index products, asset managers
will broaden their scope of investment opportunities globally looking at both
public and private company investments in a search for greater alpha
generating opportunities. As a result, 2013 is likely to see private shares
emerge as a growing institutional asset class. The potential is huge given the
sheer size of institutional assets compared to private equity or venture
4. As for the execution landscape, money will begin flowing back into equities
in 2013, increased scrutiny and regulation around broker sponsored dark pools
will lead to a decline in volume in those venues. The number of execution
brokers that asset managers use will continue to decline and the use of CSA
and sponsored brokers will continue to increase. Asset managers will begin to
classify brokers into order routing and execution destination brokers.
Choosing which execution brokers remain will be based on those that offer the
best technology and support and those that would be designated as destination
5. Regulators around the world are already communicating and collaborating
more as we move into the new year. 2013 will see that collaboration continue
and gain speed as many regulators have already centered their focus on the
same two issues, what to do about high frequency trading and broker sponsored
With milestone anniversaries in Europe and Asia Pacific, Liquidnet continues
to strengthen its role in enabling a more seamless flow of capital across the
world by providing its institutional trading network with deep and safe
liquidity so that leading asset managers can access large-scale investment
opportunities anywhere in the world.
“We remain strongly focused on building the largest and most diverse source of
safe block liquidity so that institutional investors can continue to look for
new ways to achieve performance and invest in stocks safely and efficiently,
particularly during volatile market conditions. This focus has been key to our
ongoing success,” commented Liquidnet Founder and CEO, Seth Merrin.
Liquidnet Europe launched in 2002 with 12 member firms and now works with over
100 of Europe’s leading asset managers who have traded more than 27.5 billion
shares thus far in 2012 with an average execution size of USD $1 million.
Since inception, Liquidnet has had more than 230 members trading Asia
equities, with an average execution size of $1.1 million – more than 118 times
the average execution size on the Hong Kong Stock Exchange. In Europe and
Asia, the company has won a total of 15 awards since their respective
launches. Most recently Liquidnet was named “Best Buy-Side Execution Venue” in
the European Buy-Side Technology Awards 2012 for the fifth consecutive year.
Liquidnet was also named winner of the Best Alternative Trading Venue by
Liquidnet is the global institutional trading network that connects over 700
of the world’s top asset managers to large-scale equity trading opportunities
across the globe — 41 markets across five continents. With an average trade
size of more than 44,000 shares in the US, 68,800 in Canada, and approximately
$1 million in Europe, Africa and Asia Pacific*, Liquidnet is a leader in large
block trading globally. Liquidnet does this by going beyond what the retail
market can provide by defending and securing the integrity and the anonymity
of the block trade while continuously looking for ways to bring in new sources
of safe, actionable liquidity from asset management firms, exchanges, brokers
and corporations. Asset Managers rely on Liquidnet to help them protect the
performance of their portfolios by allowing them to enter and exit their
portfolio positions more efficiently. For more information on the Liquidnet
community, its liquidity, block executions, and additional investment
capabilities, visit www.liquidnet.com.
*as of 1H 2012
© 2012 Liquidnet Holdings, Inc. and its subsidiaries. Liquidnet, Inc. is a
member of FINRA/SIPC. Liquidnet Europe Limited is authorized and regulated by
the Financial Services Authority in the UK, is licensed by the Financial
Services Board in South Africa, and is a member of the London Stock Exchange
and a remote member of the Warsaw Stock Exchange and SIX Swiss Exchange.
Liquidnet Canada Inc. is a member of IIROC and a member of Canadian Investor
Protection Fund. Liquidnet Asia Limited is regulated by the Hong Kong
Securities and Futures Commission as a licensed dealer and a provider of
automated trading services pursuant to the Securities and Futures Ordinance
and is regulated by the Monetary Authority of Singapore as a Recognized Market
Operator. Liquidnet Japan Inc. is regulated by the Financial Services Agency
of Japan and is a member of JSDA/JIPF. Liquidnet Australia Pty Ltd. is
registered with the Australian Securities and Investment Commission as an
Australian Financial Services Licensee, AFSL number 312525, and is registered
with the New Zealand Financial Markets Authority as a Financial Service
Provider, FSP number FSP3781.
Melissa Kanter, +1 646-660-8469
Global Marketing & Communications
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