TSX Group plans to launch a parallel trading order book for high-velocity, high-volume trades next year.
Codenamed Photon, it will function alongside TSX’s Quantum central limit order book that will feature a “differentiated market structure and pricing schedule optimized for high-velocity traders trading high-velocity symbols in a transparent auction market,” according to a press release.
Steve Kee, the TSX’s media director explains the implications for institutional traders: “Photon will provide greater choice for traders in how they can interact with the marketplace. Essentially, it is a slimmed-down version of the continuous order book.”
Thomas Kalafatis, vice-president, TSX Markets, explains the difference between Photon and the existing TSX Quantum book. “Our TSX Quantum central limit order book will continue to deliver rich, high-speed, diverse functionality to address complex trading issues and to provide the deep liquidity that our customers have become accustomed to, while the TSX Photon marketplace will offer the core functions and market structure adaptations that are critical to high velocity strategies,” he says.
Kee says that the broker anonymity appeals to institutional brokers. “High-velocity stock traders want quick-in, quick-out priority allocation so they don’t tip the market in the process,” he explains.
Pending regulatory approval, the Photon launch is expected to occur next year.
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