Trying to follow the machinations surrounding the various securities exchanges both here and abroad is beginning to make our heads hurt. We have been of the belief that cross-Atlantic mergers were a logical outcome given the natural "regulatory arbitrage" at play.
A raft of writers at the Wall Street Journal try to get a handle on the current state of exchange deal making. Nasdaq's move to purchase a nearly 15% stake in the LSE has shaken up the mix of potential deals. Frankly a graphic the WSJ produced does a better job of summarizing what is up than we ever could.
breakingviews believes the Nasdaq should sit tight with their current stake and wait and see "..where the price settles before moving further."
Dealbook notes two separate groups of investors have taken sizeable stakes in both the London Stock Exchange and Euronext.
One thing investors also need to keep in mind is that the current exchanges do not necessarily hold a monopoly over trading. New systems driven by cheaper technological and telecommunications costs continue to pop up. Jonathan Keeler at Institutional Investor profiles one firm that is providing able competition.
Launched five years ago, Liquidnet has helped transform the staid world of institutional trading and facilitate a movement away from classic trading desks. Founder Seth Merrin was able to bypass traditional traders through a combination of technical innovation and market insight, catapulting Liquidnet into the upper echelon of trading firms. Operating since 2001, the New York upstart reports a liquidity pool that averages 1.5 billion shares per day – the third largest in the U.S. behind the NYSE and Nasdaq.
To read all of our posts on the ongoing exchange saga click here.