SunGard Connects to MetaBit FIX Network in Japan
June 23, 2008
SunGard Data Systems has integrated its SunGard Transaction Network (STN) with Tokyo-based trading technology vendor MetaBit's market liquidity hub, the Wayne, Pa.-based company announced last week.
MetaBit touts its platform as the only "pure" FIX protocol trading hub in Japan, giving buy-side firms direct access to 34 brokers and ten exchanges for cash equities, index futures, options and commodity futures. The link between the two networks will let MetaBit's Japanese and Asian clients trade in the U.S. markets, said MetaBit CEO Daniel Burgin. "At the same time, U.S.-based customers of STN will be offered seamless connectivity to Asia-Pacific," he added.
"As part of the agreement, STN and MetaBit will extend connectivity between their respective FIX order routing networks, allowing clients of either organization to trade electronically across the destinations on each network," said Bob Ward, COO of SunGard's wealth management business, in an interview.
According to Ward, other than brokers with whom STN has direct connectivity, MetaBit is the only order routing network that STN connects with in Asia.
Clients "will be able to quickly reach any destination on either network without altering their current trading environment or adding infrastructure," said Ward. "Additionally, clients and trading partners will benefit from the local expertise and existing relationships that STN and MetaBit have established within their respective geographies."
STN clients will not be charged additional fees to access the MetaBit network, noted Ward, adding that the link will help clients reduce risks at a time when the Asian markets are not performing well. "During times of market volatility, electronic connectivity and access become a critical factor in achieving best execution and successful trade fulfillment," he said. "The use of automated trading networks can help mitigate risk, increase efficiencies and reduce operational costs."
Ward added that "as financial institutions look for new means to increase assets, the use of global trading strategies has accelerated."
Neil Katkov, head of Asia research with Boston-based Celent, said that many more clients are likely to be attracted to the combined network. "Recent years have seen the emergence of networks linking buy-side investors with various brokers and other liquidity pools," said Katkov. "San Francisco-based Tora Trading Services and New York-based TradingScreen have provided electronic trading platforms in Asia, and these networks are seeing strong interest from market participants."
However, Katkov noted that Japan is still several years behind the U.S. in electronic trading and FIX has yet to catch on with local brokers. "Instead, they are using RJFIX, a local version of FIX developed by Reuters Japan," he explained. "It's commonly used and is a Japan-only protocol for domestic equities trading."
But as interest in electronic trading increases, noted Katkov, "it will eventually drive adoption of FIX, algorithmic trading" and direct-market access.
