Aquis Exchange, the proposed new pan-European equities stock exchange and trading technology vendor, has announced its intention to establish its primary data centre at the Equinix LD4 International Business Exchange (IBX) facility in Slough, just outside London.
Aquis Exchange applied for regulatory approval as a multilateral trading facility (MTF) from the new UK watchdog, the Financial Conduct Authority (FCA), in October 2012, and says it aims to revolutionise the European trading landscape and increase competition by introducing tiered subscription-based pricing and innovative order types.
According to the company the Aquis subscription pricing model works on a similar basis to that of the telecoms industry and is designed to encourage participation from all categories of professional trading firm. Users will be charged according to the message traffic they generate, rather than a percentage of the value of each stock that they trade, as used to be common in the increasingly competitive equities trading arena which is getting more cut-throat as volumes decline. There will be different pricing bands to accommodate varying degrees of usage, maintains Aquis and a very low usage band for small firms and retail investors, suggesting this will be a key niche market for the planned new launch exchange. At the other top end of the pricing structure, Aquis is offering unlimited usage to try to attract business from traditional incumbent stock exchanges, but this is subject to a fair usage policy.
Currently, over 90% of European equity trading in each individual country takes place on two exchanges. The aim of Aquis Exchange is to bring fresh competition into the marketplace in order to lower the trading costs maintained by the existing duopoly. The company is led by former Chi-X Europe chief executive, Alasdair Haynes.
“We chose Equinix because we believe LD4 is the best connected financial hub in the UK,” said Haynes. “Equinix also has a great reputation for service and offered us a good value proposition. We are excited to be working with Equinix.”
The London Slough data centre campus run by Equinix was selected by Aquis Exchange because of its access to over 30 European markets and 80 exchanges and trading platforms in one place. In addition, the proposed Aquis Exchange, which still has to be approved and sited in the facility, will have access to the Equinix Marketplace, which allows Equinix customers to identify potential customers and partners from over 4,000 ecosystem participants, including brokers and so forth.
The Equinix London Slough data centre campus already houses equity platforms, as well as numerous foreign exchange (FX) platforms, dark pools, commodities, and new derivative products. There is also a local cross-connection facility to enhance connectivity.
According to John Knuff, general manager of Equinix Global Financial Services: “Nimble exchanges, such as Aquis, are reacting to the demands of the trading community by driving down access and infrastructure costs, when they deploy inside strategic hubs where a rich community of market participants already exists.”
• For more information about the changing equities and trading technology landscape please read the bobsguide TradeTech 2013 show report.