Dark Pool Traders Look to Stay in the Shadows
- Regulator limits on dark-pool trading will upend the venues
- Auctions and new markets will allow unlimited dark trading
Financial traders monitor data inside the Frankfurt Stock Exchange in Frankfurt.
Photographer: Martin Leissl/BloombergDark pools face a major overhaul once European limits on hidden trading kick in next year. Luckily for investors, there’s a buffet of offerings to help keep their stock trades under the radar.
The rules known as MiFID II, just six months away, loom large over European operators of dark pools -- they introduce a cap on transactions that would by one estimate bar three quarters of big European stocks from the trading venues. Investors love dark pools because they allow them to trade big orders without tipping off the market to their intentions. That demand isn’t going anywhere, so firms have been rushing to roll out services that allow investors to sidestep the rules.