Liquidnet Is Liquid In APAC
Liquidnet recently reported its quarter ended September 30, 2009 where, among other achievements, notional executed in Asia-Pacific increased 52% to US$3 billion from the previous quarter. And compared to the same quarter last year boasted and 81% increase. Good results in a tough market.
With the previous 12 or so months begin fraught with fear and spreads necessarily widening buy side clients were having a tough time keeping their execution costs down. As such, moving away from algo’s and utilizing experienced dealers for better executions was the trend. Liquidnet, however, offered another alternative to the buy-side by affording the crossing of large ADV orders anonymously avoiding signaling to the market or without much price impact in it’s Liquidnet Negotiation or Liquidnet H2O pools. A large percentage of these orders were done at the midpoint which is substantial given how much spreads have widened in APAC. This last quarter their liquidity pools offered approximately US$6 billion per day with average trade size of just over US$ 900,000. If we compare to average executions done on Asia’s equity exchanges which vary from US$10,000 to $20,000 Liquidnet is certainly a viable destination for your equity flow.
Liquidnet came to Asia in November 2007 when it opened its Hong Kong office and began trading in Hong Kong, Korea, Singapore and Japan markets. Business started in Australia February 2008 and was well received. Over the first two weeks of trading (they had to cross on the ASX initially) Liquidnet’s Australia business did 152 trades worth AUD$200million with its largest trade worth over AUD$5million. Not many brokers can do that in a year.
One year later in November 2008 to serve the demand of its Singapore business Liquidnet opened an office on the island nation. Today, Liquidnet has over 150 clients trading in Asia’s equity markets and executed USD1.1billion of notional in August 2009. It was also recently awarded “Best Venue in Asia-Pacific for Block Trading” in 2009.