Deutsche Bordse says the liquidity and number of trading participants in the trading of Dutch equities on Xetra has increased substantially since the Dutch segment, Xetra Dutch Stars, was launched three months ago.
The average order size has tripled to about Euros 30,000 through the expansion of the segment on 17 November. The spreads in the trading of Dutch equities have narrowed and market depth has increased. Based on the Xetra Liquidity Measure (XLM), the implicit transaction costs in the Dutch segment have decreased from 80 basis points in October to 20 basis points. This represents a reduction of 75 per cent. Trading participants benefit from the higher liquidity and thus lower trading costs.
The Royal Dutch equity topped Nokia as the highest-liquidity equity on Xetra. With 11.5 basis points, Royal Dutch is one of the most liquid equities on Xetra. Unilever and Philips rank among the 50 most liquid equities in the meantime.
The number of Xetra participants trading Dutch equities has increased by about 25 per cent since the new segment was launched. Of the some 310 participants admitted to trading, roughly 120 companies are now trading Dutch equities. After the British participants, Dutch banks and financial-service providers are the largest non-German group of participants on the pan-European Xetra trading platform.
Deutsche Brse launched the new segment for Dutch equities on the Xetra electronic trading system on 17 November. Since that time, participants have been able to trade all of the 25 equities in the Dutch AEX25 blue-chip index continuously on the world’s largest exchange-trading network. Market makers provide for high liquidity and narrow spreads.
In order to facilitate access for new participants to the Xetra electronic trading system, Deutsche Brse is reimbursing part of the fees to the most active participants and bearing the costs of the technical connection to Xetra for new customers. This makes Deutsche Brse the lowest-cost provider for trading, clearing and settlement in Dutch equities.