The NZX has appointed electronic trading system provider Trayport to provide the core equity and debt market software and a trade-reporting system for its planned electronic communications network, designed to take on the Australian Stock Exchange in its daily $4.5 billion business across the Tasman.
The appointment follows a global tender process. NZX head of market operations Martin Sheffield says a “request for proposal” was issued in June to eight providers. None was New Zealand-based.
Trayport provides real-time electronic trading software to 49 markets worldwide. NZX will be its fifth regulated exchange client.
Sheffield would not disclose the cost of the software, whose target roll-out date for Australia is the end of the first fiscal quarter of 2007. It will be rolled out into the New Zealand market at the end of the third quarter next year.
The New Zealand exchange has formed a venture with five of Australia’s biggest broking firms: Citigroup, CommSec, Goldman Sachs, J B Were, Macquarie Bank and Merrill Lynch. Each of the brokers holds 10% in the new company, and NZX holds 50%.
Electronic communications networks allow large investors to trade shares without having to go through the market operator, thus reducing fees.