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Dark Pools allow funds to line up and move large blocks of equities without tipping their hands as to what they are up to. Modern trading platforms and the lack of human interaction have reduced the time scale on market movements. This increased responsiveness of the price of an equity to market pressures has made it more difficult to move large blocks of stock without affecting the price. [2]Dark pools of liquidity (also dark pools or dark liquidity) are crossing networks that provide liquidity that is not displayed on order books. This is useful for traders who wish to move large numbers of shares without revealing themselves to the open market.
Dark liquidity pools offer institutional investors many of the efficiencies associated with trading on the exchanges' public limit order books but without showing their actions to others. Dark liquidity pools avoid this risk because neither the price nor the identity of the trading company is displayed.
Dark pools are recorded to the national consolidated tape. However, they are recorded as over-the-counter transactions. Therefore detailed information about the volumes and types of transactions is left to the crossing network to report to clients if they desire and are contractually obligated.[1]
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[edit]Independent dark pools
- Instinet
- SmartPool
- Posit from Investment Technology Group (ITG)
- Liquidnet
- NYFIX Millennium
- Pulse Trading BlockCross
- RiverCross
- Pipeline Trading Systems
[edit]Broker-dealer-owned dark pools
- BNP Paribas
- BNY ConvergEx Group (an affiliate of Bank of New York Mellon)
- Citi - Citi Match
- Credit Suisse - CrossFinder
- Fidelity Capital Markets
- Goldman Sachs Execution and Clearing
- Knight Capital Group
- Deutsche Bank Global Markets
- Merrill Lynch
- Morgan Stanley
- UBS Investment Bank
- Ballista ATS Ballista Securities LLC[citation needed]
- BlocSec[citation needed]
- Bloomberg Tradebook (an affiliate of Bloomberg L.P.)
[edit]Consortium-owned dark pools
- BIDS Trading - BIDS ATS
- LeveL ATS
[edit]Exchange-owned dark pools
[edit]Other dark pools
[edit]Dark Pool Aggregators
- QUOD FINANCIALwww.quodfinancial.com
- Progress Apama
- ONEPIPE - Weeden & Co. & Pragma Financial
- Xasax Corporation
- Crossfire - Credit Agricole Cheuvreux
[edit]See also
[edit]References
- ^ http://www.quantprinciple.com/invest/index.php/docs/realworld/darkpools/#tape Consolidated tape and DARK Pools
- ^ http://www.quantprinciple.com/invest/index.php/docs/realworld/darkpools/ Dark Pools some reasons
