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Exchanges only have a couple of hundred customers afaiu, with the volume coming through only a couple of dozen, everyone else is through their prime broker. In
by throwaway13249 7y ago
Exchanges only have a couple of hundred customers afaiu, with the volume coming through only a couple of dozen, everyone else is through their prime broker. In other words there is a limit on how much they can pull fees up before liquidity moves elsewhere. I wouldn't be surprised too if the matching software was off the shelf.
- derefr 7y ago> I wouldn’t be surprised too if the matching software was off the shelf If there exists a business whose product is “scalable real-time order-book matching software” as licensed software or SaaS, I’d love to know about it! I’m in an adjacent space, and I’d love to strike up a partnership with such folks. As far as I know, such a business doesn’t exist; all the big exchanges maintain their own core IP, much like all the big telcos in the 90s maintained their own core telecom-equipment IP. From what I know of the space, each player thinks that licensing the IP would just be either inviting a new player to the table, or more likely inviting enough new players to the table that other parts of the trading value chain would start to see value in abstracting-away and commoditizing their part of it.
- andylynch 7y agoSecond Nasdaq. They lead in this space. Also challenging is Aquis with the technology behind their own venue.
- pdovy 7y agoI'm not quite sure how the terms / licensing for this works, but anecdotally OSE, SGX, TOCOM, BrokerTec and at least the derivatives business in Hong Kong all run on some variant of Nasdaq technology.
- wibble10 7y agoMurex is going “cloud”