In consultation with almost 70 local and global fund managers, stock exchange, Chi-X Australia, has launched MatchPoint, a new market-on-close trading solution.
MatchPoint allows market participants to place anonymous orders, with minimum execution size protection, between 10:00am and 4:20pm. It will only execute at the closing price and therefore provides traders and investors with greater certainty that their orders, when executed, will fill without market impact.
Chi-X Australia Chief Executive Officer Vic Jokovic says: “With the Australian closing auction trending towards 25 per cent of the day’s volume, MatchPoint was developed to provide a flexible and competitively priced product to our client-base that complements the traditional closing mechanism. It has been supported by local and global fund managers and the superannuation community so we are pleased to deliver this customer-driven offering to the Australian marketplace.”
With the dramatic increase in closing auction volumes globally over the past few years, driven by the growth of passive fund management, Murrough O’Brien, Head of Institutional Sales at Chi-X Australia believes MatchPoint is a potential game-changer for buy-side participants who need to place large orders benchmarked to the closing price.
“We believe that MatchPoint is not only a solution that will allow participants to execute large orders with price certainty, while remaining anonymous, but that it’s also vital for healthy competition in the market,” says O’Brien.
MatchPoint is the latest in a string of innovations which Chi-X Australia has delivered to the Australian marketplace which also includes Warrants, TraCRs (a depositary receipt programme), Indices (CXA 200) and a soon to be launched ETF market.
“Chi-X Australia has driven over AUD200 million in cost savings to brokers and investors since inception and MatchPoint is yet another example of how we continue to do this,” says Jokovic.
