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Turquoise Trading Update, One Week In

Turquoise, the European multi-lateral trading facility (MTF) established by nine investment banks, has officially finished its first week of soft-launch trading activity.

The initial launch featured trading in 10 stocks—five U.K. and five German. "Everything is going exactly as planned," says Eli Lederman, CEO of Turquoise, adding that stocks from France and the Netherlands were also recently added.

"Every day has been a record in terms of the number of trades and the notional value executed, but the number is still small," he says. "But we've seen executions in the lit side as well as in the dark pool and we've had executions between the visible and the dark so that begins to validate our market model."

Each day of the first week, more and more trading members have been connected to the platform and begun trading and then five stocks from each country for the initial trading activity.

"We had something like 10 percent market share in one of the illiquid names where there was a large dark execution," says Lederman. "We want those numbers to go up every day."

He adds, "We expect market making activity to increase steadily as we add more countries and by the middle of September we expect to be in full swing." The first day of trading saw 14 participants on the platform and Lederman expects to have another 50 on board in September. "I have been saying that I expect to have in the order of 5 percent market share by the end of the year and I think that's a reasonable target," notes Lederman.

"But internally we have higher aspirations and our goals are even higher than that. This is a process and we will learn as we go along but I think that we're on track," he says.

Turquoise will continue to add stocks and participants with almost 1300 stocks in 13 European markets expected to be live on Turquoise by August 29th.

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