Electronic trading in the equity markets has grown dramatically in recent years and is expected to continue growing, according to a new survey of institutional equity traders and technologists.
Approximately 72% of respondents surveyed by RBC Capital Markets said they expect to increase the amount of trading they do electronically in 2010.
"The trading environment has become so complex and fragmented that clients are always curious to know about the issues and concerns facing their peers," said Bradley Katsuyama, global head of equity electronic trading at RBC Capital Markets. "We believe there is value in monitoring and communicating these developments."
Survey respondents had strong views about proposals to limit "dark pools," proprietary trading at banks and other alternative trading systems, as well as a possible financial transactions tax.
More than half of respondents said they think abolishing proprietary trading at banks and other deposit-taking institutions is a bad idea, and 86% said they think a ban on proprietary trading would have an impact on equity market liquidity.
The traders and technologists surveyed had mixed views of high-frequency trading, with 32% reporting the practice had a negative impact on their performance, 31% reporting a positive impact and 37% reporting no impact on performance. Fifty-four percent said they have adjusted their trading styles as a result of high-frequency trading, while 46% said they had not.