Peer-to-peer price discovery and liquidity sourcing technology provider Appital has launched Trending Equities, designed to drive opportunistic liquidity.
Trending Equities enables proactive stimulation of unique market liquidity from buy-side deal originators, in advance of a deal launch. Buy-side firms are also able to gain exposure to potential imminent deal launches on the platform in equities relevant to them.
Mark Badyra, CEO of Appital, told Global Trading: “Access to hard-to-find liquidity remains a huge challenge for the buy side and matching technology alone is not enough to help unlock latent liquidity.
“Historically, the market for size has been driven by brokers but concerns over information security and leakage have further contributed to a decline in liquidity. Matching technology is not up to the task as the likelihood of a match naturally decreases with order size. At the same time, the most challenging trades require greater control and oversight by buy-side traders and we see large/parent orders being cut down to manage information leakage, thereby exacerbating systemic illiquidity in the market. With Appital Trending Equities we move closer to solving this problem by proactively stimulating market liquidity ahead of the event.”
Unlocking latent liquidity though this service allows trading desks and portfolio managers to generate orders on the market that would not otherwise exist, Appital explained, enabling greater optionality, and driving the bookbuilding process. Matching technology alone is not enough to achieve this, Mark Badyra, CEO of Appital, explained to Global Trading.
“Historically, the market for size has been driven by brokers but concerns over information security and leakage have further contributed to a decline in liquidity,” he continued. “Matching technology is not up to the task as the likelihood of a match naturally decreases with order size. At the same time, the most challenging trades require greater control and oversight by buy-side traders and we see large/parent orders being cut down to manage information leakage, thereby exacerbating systemic illiquidity in the market. With Appital Trending Equities we move closer to solving this problem by proactively stimulating market liquidity ahead of the event.”
It also solves challenges around decreasing lit liquidity, the company affirms, reducing reliance on market close and addressing the reduction in high-touch sales trading and its associated liquidity opportunities.
The functionality sits within Appital Insights, a service allowing buy-side institutions to gain feedback on the likelihood of launching a successful bookbuild without alerting others in the market or risking price erosion. It also allows traders and portfolio managers to gain passive exposure in equities, the company stated, with consideration to minimum average daily volume ambitions and pricing thresholds.
Trending Equities is now in use by Appital’s onboarded asset managers.
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