LiquidityCrosser is a fast and scalable matching engine that provides institutions with the choice of how they want both their internal and client flow to behave and interact. They can create personal dark pools using matching criteria that can be reconfigured and redefined where the highest bid does not necessarily have to match against the lowest offer.
The matching engine, at each change of event, recomputes the state of the market and executes all potential transactions. It supports various order types and execution conditions. The system uses a full in-memory process, based on optimized numerical calculation patterns.
Organizations using LiquidityCrosser can design custom matching patterns that achieve their required levels of flexibility, scalability, and performance.
Like all of smartTrade’s Liquidity Management system (LMS) components, LiquidityCrosser can be implemented by individual asset class or on a cross-asset basis as part of the organization’s electronic trading backbone.
- Enables systematic internalization of orders. The internalizer becomes the systematic counterpart to all incoming client orders, capturing profits based on the bid/ask spread.
- Supports dynamic crossing, allowing a resting order to be placed on the market and then recalled through cancellation in the event that a counterpart order arrives internally.
- Allows clients to execute in the dark and reduce information leakage and minimize market impact by executing internally when liquidity is available without sacrificing the opportunity to capture lit liquidity in order to fully execute.
LiquidityCrosser is one of the core components of smartTrade’s sophisticated liquidity management systems. It is used as a stand-alone system or in combination with LiquidityConnect, LiquidityDistributor, LiquidityOrchestrator, LiquidityAggregator and the Order Management System. Together, these components can be assembled to develop multi-asset trading platforms that:
- Connect electronically to any number of venues regardless of messaging protocols.
- Aggregate liquidity from dozens of sources to create a single order book.
- Distribute customized pricing to clients.
- Manage client order flow.
- Implement smart order routing using proprietary algorithms.
- Internalize liquidity and/or route it to external venues.
- manage state throughout the order lifecycle.
The system handles multiple asset classes and is in production globally supporting foreign exchange, fixed income, equities, rates, and many other instrument types.
Pricing needs to understand the fair value of an instrument by comparing internal prices to external venues and cross-product correlations, so that rules can then shoot orders to the internalization engine or to the appropriate external exchange or crossing net.
Harry Gozlan, smartTrade Technologies Executive Chairman