Xetra Quote Request allows for optimized execution of large-sized ETF orders/ Leading ETF issuers and market makers support the new service…
Deutsche Börse has launched a new service which allows for an optimized on-exchange execution of large-sized ETF orders, the Xetra Quote Request. It enables users to take full advantage of Deutsche Börse’s complete service chain – from trading, clearing and settlement to trade reporting and market data dissemination. The process is designed to achieve a high degree of automation, while at the same time reducing settlement and counterparty risks, and ensuring compliance with best execution requirements for large orders.
Xetra Quote Request is supported by leading European ETF market makers, including among others, Goldenberg Hehmeyer, Susquehanna International Securities and UniCredit Bank. Around 500 ETFs will be covered initially by the new service, with additional products being added over the coming months.
“As Europe’s leading ETF exchange, Deutsche Börse is committed to improving the efficiency of on-exchange trading in ETFs“, said Martin Reck, Managing Director Cash Market at Deutsche Börse. “Xetra Quote Request provides investors with an effective alternative to executing large-sized ETF orders. It is an initiative which is seeing great support both from ETF issuers and market makers.”
“In 2015, we saw almost €100 billion worth of iShares ETFs being traded on the Deutsche Boerse. Xetra Quote Request is another example of industry innovation that will bring greater transparency and liquidity to ETF markets,” said Jane Sloan, Head of iShares Capital Markets EMEA at BlackRock.
“As a leading ETF market maker we are pleased to have Xetra Quote Request as an innovative tool to help us achieve our mission to provide liquidity to the growing number of investors in ETFs,” said John Keogh, Managing Director of Susquehanna International Securities.
Xetra’s product offering currently comprises more than 1,400 individual Exchange Traded Funds and Exchange Traded Products, making it the largest offering of all European stock exchanges. It covers all major asset classes including equities, fixed income, commodities and currencies. This selection, together with an average monthly order book turnover of around €16 billion, makes Xetra Europe’s leading trading venue for ETFs.
About Xetra Quote Request:
Instead of having to negotiate ETF transactions bilaterally over-the-counter (OTC) or through request-for-quote (RFQ) systems, Xetra Quote Request enables investors to send quote requests to all registered Designated Sponsors (market makers) of a selected ETF. Designated Sponsors respond to quote requests by updating their quotes in the Xetra order book, thus enabling execution of large-sized orders by submitting additional liquidity to the market when needed. Investors therefore benefit from a potential price improvement over execution against a single market maker quote, and ensure best execution by simultaneously interacting with the full liquidity available in the order book.