Multi-Venue Technology | CFDs

DMA trading with us enables you to use our smart order routing and multi-venue technology to access better prices on share CFDs.

As well primary stock exchanges like LSE and Euronext, our clients also have the opportunity to trade directly into the order books of Europe's leading multilateral trading facilities (MTFs): Chi-X and BATS.

WHAT ARE MTFs?

MTFs are essentially alternative platforms to stock exchanges for share trading. They often provide better prices than the primary exchanges and can account for over 40% of a stock's overall liquidity.

What does multi-venue technology give you?

• Best possible prices due to aggregated prices from across the exchanges
• Better execution thanks to increased liquidity
• Technology that automatically hunts down the optimum prices
• Free live price feeds from MTFs

How does it work?

PureDMA, our browser-based DMA trading platform instantly searches all available venues and puts the best price in the order book. It doesn't separate the prices according to their venue – instead the prices appear in a 'hybrid' layout.

When you click on one of these prices, our smart order routing technology immediately routes your order to the relevant venue. By routing your order across multiple order books it's more likely that your order will be filled, but you will only ever be charged one commission per order.

If your requested size and price is not available, your order will be routed to the primary exchange, where the greatest level of liquidity is generally available.

MTF lit books

MTFs provide visible order books in the same way that primary exchanges do, so that you can see the price and size of all orders, and judge where you want to place your order. We combine these MTF lit books and the primary exchange order book to display a single aggregated order book.

If you are using our L2 Dealer, you can view the individual order books for each exchange and MTF.

Dark pool liquidity

Our technology also connects you to the dark pools of liquidity provided by MTFs like Chi-X’s Delta or BATS Europe’s Dark Pool. These are orders not displayed on the lit books but are available for you to trade against. Dark liquidity pools are often used by institutional investors who do not wish to reveal the price, size and origin of their orders.

This means that as well as the liquidity visible on the lit order books, trading share CFDs with us gives you unparalleled access to the non-displayed liquidity found in the dark pools. This means you can take advantage of even greater levels of liquidity, increasing the likelihood of your orders being filled and the potential for better prices.

Better prices

During the week of 2-9 June 2010, 45% of all trades on clients' accounts had a fill in some part from the MTFs. The executions that were done on the MTFs gave an average saving of 3.26 bps over the primary price at the time.

And by accessing the non-displayed liquidity of the MTFs' dark pools there is even more opportunity for improvements. 12% of all trades on clients' accounts had a fill in some part from the dark pools. The executions that were done on the dark pools gave an average saving of 7.85 bps over the primary price at the time.

Previously, MTF lit and dark liquidity was only available to large institutional investors; however we enable all CFD traders to access these new venues through our two DMA trading solutions – our browser-based trading platform and L2 Dealer.