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Spoofing, Surveillance and Supervision

Jay Biondo, Product Manager - Surveillance at Trading Technologies, co-authored an article along with James Lundy and Nicholas Wendland, both of Drinker Biddle & Reath LLP, reviewing the CFTC's regulations and expanding efforts, 21st century surveillance and supervision, as well as strategic recommendations.

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May 25, 2007

Liquidnet Snatches Miletus

By Nina Mehta

Institutional broker Liquidnet last month announced its first-ever acquisition when it said it would buy Miletus Trading, an agency broker and quantitative algorithmic trading boutique with a suite of sophisticated single-stock and portfolio algorithms.

Market participants say the acquisition could ease Liquidnet's path into the program trading business. It could also make the current process of negotiating for blocks one at a time more efficient in the context of managing a portfolio.

Liquidnet founder Seth Merrin dismissed early speculation about what the acquisition meant. "We're buying Miletus not for their existing technology but for their brains and what we can jointly offer going forward," he told Traders Magazine. Liquidnet also doesn't intend to use Miletus's technology to ape anything its competitors--namely Investment Technology Group--are doing. "Our value proposition is not in providing algos to go into the public marketplace--the public market is the execution place of last resort for institutions," Merrin said.

Miletus was formed three years ago by Michael Capelli, an ITG veteran, and others. The firm's 28 employees, half of whom are in technology, will join Liquidnet's staff of 210.