BMO electronic trading: “Our focus on execution is at the core of everything we do”
The winner of the 2023 European Markets Choice Award for Best Algo Provider, BMO has made a big splash in Europe since the launch of its EMEA electronic trading offering a year ago. Best Execution sat down with Mike Green, COO of EMEA electronic trading, to discuss the journey so far – and the road ahead.
Why did you decide to launch a European platform?
Very simply, because our clients asked us to and we knew we had a product that works in complex and fragmented markets. We recognised the opportunity to expand into Europe, and bring the power of the Algorithmic Management System (AMS) and our experience around execution, access to markets and coverage, along with premier client service.
What have the biggest challenges been?
Since our launch we have seen a downturn in the market resulting in less volumes. As a new entrant, we had to gain share in an already entrenched algo environment. But with our differentiated technology and our global services model, we have seen EMEA clients adopt our offering domestically and in North America. Our EMEA build out of the AMS provides access to 80+ venue services, with connectivity to two data centres, soon to be expanding to six across Europe.
How has the platform grown over the past year?
We’re are adding new clients across both the buy and sell side. We are continually optimising our offering. In the past year we have added several new features to the AMS to optimise close auctions and trade opportunistically with minimal impact. Furthermore, our agile development process enables us to enhance our offering frequently to address the ever changing market microstructure. Within Europe itself, we have a dedicated and experienced electronic team that is securing new relationships to the firm as well as aligning with BMO’s clients in Europe and North America who want to trade European equities.
In Europe, this team consists of electronic trading professionals across sales, trading, market microstructure, product, technology, settlement and infrastructure.
What have been some standout moments over the past year?
That’s a great question. Our first trade was a big step. Our CEO of Capital Markets happened to be in the office in London when we did it. That was a huge moment.
Another stand out moment, was when one of our biggest institutional partner clients was in a position to say to us: “I think you have access to all the markets we need. We’re ready to go.”
Also, on the broker-dealer side, we’ve had some very decent-sized players say to us: “We see what you’ve done in North America, we can see how successful you’ve been there, and we’d like you to do the same for us in Europe.” We now have a good number of broker-dealers that are using the AMS to service their buy-side clients, accessing a single market or multiple markets, and that’s a big deal.
What differentiates the BMO algo offering from others?
First and foremost, our approach to algorithmic trading is to bring transparency to electronic trading, encourage experimentation to achieve better quality executions, and facilitate collaboration between the buy side and sell side to configure algorithms to achieve the desired goals of the trade.
In addition, our regional coverage model, the AMS, and our deep experience in market microstructure across EMEA and North America set us apart from our competitors.
What’s your focus for the coming year?
Our focus from a product and technology perspective within Europe is just to continue to mature our offering, gain more share, and continually provide a service to our clients that helps them achieve better quality outcomes.
How do you measure your success?
Success is measured in the satisfaction of our clients and our ability to deepen relationships and scale trading in EMEA equities globally. I am pleased with what we have been able to accomplish so far, albeit in a short period of time. By this time next year, I’d like to have multiple times the number of clients that trade with us, and that they are going through a successful, iterative algo performance process with us. That will be success.
©Markets Media Europe 2023
