MiFID II Equities: Dark Pools Hit High During Summer Slowdown

https://tabbforum.com/opinions/mifid-ii-equities-dark-pools-hit-high-during-summer-slowdown/

Tim Cave, TABB Group- Dark trading reached its highest level under MiFID II in July, accounting for 9.6% of all on-exchange activity. It is dark pools’ largest market share since April 2019, when they accounted for 9.1% of activity. Block specialist Liquidnet enjoyed a particularly strong month, with total daily notional volumes of €454 million, its third-highest total since January 2017.

The biggest factor affecting dark volumes in Europe is MiFID II’s dark pool caps, which limit the amount of dark trading in a stock to 4% of total on-exchange volumes on any one dark pool and 8% across all dark venues. Volumes are monitored on a retrospective 12-month basis every month, and those stocks breaching the caps are banned from trading in the dark for the next six months.

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Author: Chandler

https://www.linkedin.com/in/chandlerparis/