Plato Partnership and SL Tools have partnered to bring block trading capabilities to the Brazilian marketplace in the wake of regulatory reform by the Brazilian Securities Commission.
In the past local regulations would trigger an open auction process when trying to execute a large position in the marketplace which could result in traders being shut out of their own auctions.
SL Tools CEO Andre Duvivier said: “There is no sustainable way to trade around these market conditions yet, and some traders resort to trading in smaller pieces or using broker algos, which take a long time to fill and dislocate prices.
“A block trading facility will provide a viable way for institutions to trade around these market inefficiencies, with pricing at the midpoint and minimal market leakage or price impact. This regulatory move is an exciting development for the region as it has opened the door for a wave of innovation in Brazil.
“The opportunities for institutional investors to access new liquidity in the Brazilian market cannot be overstated.”
Plato Partnership CEO Mike Bellaro said market conditions in Brazil resemble those in Europe 15 years ago, when outdated trading systems significantly impacted execution and performance. At the time, the firm worked with Turquoise to launch a block trading facility.
Bellaro said this latest partnership will enable Brazilian and global investors to trade large blocks of shares more efficiently, and generally “level-up” capital markets in the region.
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