The London Stock Exchange Group (LSEG) has launched a new trading service, Turquoise Retail Max, to provide best execution and price improvement services to retail brokers. The new service is available through Turquoise Europe, the pan-European trading platform majority owned by the LSEG in partnership with the user community.
LSEG Introduces Turquoise Retail Max
The service, which seeks to improve service delivery to retail investors who trade pan-European securities, helps retail brokers to achieve best execution 'through a competitive multilateral auction process'. The service is also targeted at helping retail brokerages achieve 'efficient processing' from trading to clearing and settlement.
According to the LSEG, Turquoise Europe through the new service is extending the benefits of price improvement on aggressive and passive orders to retail brokerages and their orders. The London exchange operator plans to onboard quantitative trading firm, Hudson River Trading, and full-service brokerage firm, Stiffel, as the first retail liquidity providers to utilize the new service.
“Orders flagged as originating from a retail investor can achieve best possible outcomes by utilizing a price formation mechanism based on liquidity provided by both specialist retail liquidity providers and all other market participants,” the LSEG said in a statement.
Speaking on the new service, Adam Wood, the Chief Executive Officer of Turquoise Global and the Head of Equities Trading Commercial Proposition at the London Stock Exchange PLC, noted that the new service means that retail brokers for the first time can "achieve execution at primary market midpoint in a fully pre-trade transparency order book.”
“Clients’ orders will benefit from a diverse source of liquidity, with competitive pricing through a traditional auction process,” Wood said, adding that: “By placing retail investors' orders at the centre of the price formation mechanism, the new service will assist retail brokers in achieving best execution.”
LSEG Continues Strong
As the LSEG continues to expand its services, the top financial markets infrastructure and data provider has remained profitable. In 2022, the UK company’s total income jumped 18.5% year-over-year (YoY) to £7.74 billion (including recoveries), which is higher than market expectations. The stock exchange’s operating profit also shot up by 33% YoY last year, reaching £1.4 billion.
Additionally, the LSEG has initiated a £750 million share buyback programme to repurchase its shares from Blackstone and Thomas Reuters. The deal, which comes two years after the stock exchange operator acquired Refinitiv from both companies, is expected to be completed by April 2024.
In late 2022, the LSEG disclosed plans to buy out Acadia, a US-based risk and collateral management services provider. Meanwhile, the technology giant, Microsoft recently bought a 4% stake in the group after signing a 10-year partnership deal with the London exchange operator.
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