(Bloomberg) -- Credit Suisse Group AG, Barclays Plc and UBS AG were the largest darkpools in the Financial Industry Regulatory Authority’s first weekly report meant to make the private trading systems more transparent.
The Wall Street regulator created the repository to reveal how much U.S. equity volume is handled on alternative trading systems including dark pools. The private platforms have won market share from the public exchanges, which now only handle about 60% of volume, and drawn scorn from critics including author Michael Lewis, whose “Flash Boys” argues that broker-dealers use dark pools to rip off investors.
“Any time there’s a significant portion of the marketplace that’s opaque, there are people who are concerned because they don’t understand exactly what’s happening,” Steven Joachim, the industry-funded brokerage regulator’s executive vice president for transparency services, said in a phone interview today. “This is a portion of shedding light on the activity levels by ATSes and the amount of activity these dark pools are doing today.”
Under the new initiative, the public will be able to see on Finra’s website the total shares traded each week in each ATS or dark pool. Information made public today is from reports filed for the week of May 12-18, Finra said. Before the regulator’s move to make the information public, volume on alternative trading systems was publicized by market research firms using data provided voluntarily by brokerages.
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