Sign up for our newsletter

09.01.2018 18:32 Age: 279 days
Category: News

MiFID II to regulate ETF private trading venues

The newly applicable provisions of MiFID II on reporting duties also concern financial transactions of Exchange-Traded Funds (ETFs). Considering that the majority of initial ETF trading (primary dealing or creation) takes place directly between market makers (such as credit institutions – buyers) and authorised participants (distributors), the upstream market for ETFs is made through over-the-counter trading, also known as dark pools.

Therefore the upstream market is opaque and ‘non-transparent’, according to Catherine Lafferty, who notes that under MiFID II ‘ETF trades [...] have to be transparently reported.

More transparency with respect to trading volumes and liquidity of ETF downstream markets (which are the regular trading venues for ETFs) will increase use and trade of ETFs for the purpose of leveraging, considering that these securities are cost and tax efficient, considerably less risky (since the underlying assets-portfolio is diversified and the strategy is to track indexes) and flexible (they allow short-selling and margin trading).

Read here:

Funds Europe: ETFs get MiFID II securities lending boost

BETTER FINANCE article: How MiFID II will shine more light on financial markets

More information on ETFs: Central Bank of Ireland Discussion Paper: Exchange-Traded Funds.


The latest edition of our report on Pension Savings is now available for download!





December - 2017
  01 02 03
04 05
07 08 09 10
11 12 13
15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31
Thursday, 14. December 2017