The London Stock Exchange and Lehman Brothers plan to create a pan-European MTF (multilateral trading facility) for the execution of non-display orders, to be named Baikal.
Baikal will be a neutral liquidity venue led by the London Stock Exchange and will offer the following key features:
Open, equal access to securities across 14 European countries with smart order routing to liquidity in at least 22 trading venues;
A suite of dynamic, liquidity seeking algorithmic trading strategies;
Anti-gaming controls and market surveillance tools;
Real-time post trade reporting included in the London Stock Exchanges Infolect feed; and
An pan-European clearing and settlement solution with aggregated trade booking for Baikal-matched and smart order routed business.
“The London Stock Exchange has an over-arching objective to improve market efficiency for the benefit of investors and issuers, and we will continue to innovate to promote that goal,” says Clara Furse, LSE’s chief executive. “Baikal provides an exciting opportunity for the market to transact certain types of business in European equities with the confidence of total pre-trade anonymity, alongside the efficient price formation of the electronic order books of exchanges, where the majority of equities across Europe are traded.”
“Baikal represents a substantial evolutionary step in providing market participants with the ability to access and utilise efficiently dark liquidity in European equities,” says Jeremy Isaacs, Lehman Brothers CEO for Europe, Middle East and Asia-Pacific.