Cowen Inc today announced that, following the closing of its acquisition of Convergex Group, LLC, it has made the strategic decision to discontinue the Millennium ATS midpoint matching offering.
Millenniums Form ATS has been amended to reflect this change and all subscribers and trading partners have been notified of the pending change. All midpoint matching in the Millennium ATS will end as of June 23, 2017.
Jeffrey M. Solomon, President of Cowen, said, Over the past several years, many of our clients have expressed frustration with the amount of fragmentation in U.S. equity markets. Some have also raised concerns regarding conflicts of interest that can arise in broker order routing. At Cowen, we have built our business around non-conflicted execution capabilities and the closure of the Millennium dark pool reflects our commitment to market neutrality and best execution for our clients.
Added Solomon, This decision was one of the first and most important decisions we made following our acquisition of Convergex, and is reflective of Cowens consistent dedication to market structure issues. By discontinuing Millennium ATSs midpoint matching engine, we had the ability to proactively reduce fragmentation, something we and many of our clients feel will improve U.S. equity market structure. As we continue to grow our trading business, we will continue to innovate to help our clients find liquidity in a fragmented trading environment.
Cowen will continue to operate the Millennium Crossing Facility (MCF), which is part of the Millennium ATS. This trade printing function runs separately from the midpoint matching engine. The MCF executes pre-matched orders and prints the resulting trades to the tape on behalf of exchange and broker-dealer partners. This crossing facility will continue going forward. However, any trading volume attributed to the Millennium ATS following June 23, 2017 will simply and solely reflect the volume of pre-matched trades within the Millennium ATS for trade reporting purposes. As of June 23, 2017, there will be no midpoint matching engine within the Millennium ATS and no continuous trading functionality. Millenniums Form ATS has been amended to reflect this change.
In a letter to clients, Cowen President Jeffrey Solomon wrote the following:
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June 1, 2017 As we continually evaluate the market structure landscape in U.S. equities, Cowen has made the strategic decision to discontinue the midpoint matching offering within our ATS, Millennium. Millenniums Form ATS has been amended to reflect this change and all subscribers and trading partners have been notified of the pending change. All midpoint matching in the Millennium ATS will end as of June 23, 2017. Cowen took over operations of Millennium as part of the acquisition of Convergex on June 1, 2017. Over the past several years, many of our clients have expressed frustrations with the amount of fragmentation in U.S. equity markets. Some have also raised concerns regarding conflicts of interest that can arise in broker order routing. At Cowen, we have built our business around providing innovative and non-conflicted execution capabilities for our clients. Cowen does not operate an equity trading venue. We have never operated an equity trading venue. That has been by design. As we grow our trading business and look forward, we will continue to innovate to help our clients find liquidity in a fragmented trading environment. However, we do not feel operating a dark pool matching engine is consistent with these efforts or our core values as a firm. Cowen has invested heavily in market structure in recent years. We have worked with regulators and policy-makers to improve market structure for issuers and investors. We research market structure on a daily basis and implement our findings directly into trading products to continually improve execution quality for our clients. By discontinuing Millennium ATSs midpoint matching engine, Cowen has the ability to proactively reduce fragmentation – something we and many of our clients feel will improve U.S. equity market structure. This decision was one of the first and most important decisions we made following our acquisition of Convergex, and is reflective of Cowens consistent dedication to market structure issues. Cowen will continue to operate the Millennium Crossing Facility (MCF), which is part of the Millennium ATS. This trade printing function runs entirely separately from the midpoint matching engine. The MCF executes pre-matched orders and prints the resulting trades to the tape on behalf of exchange and broker-dealer partners. This crossing facility will continue going forward. However, it is important to clarify that any trading volume attributed to the Millennium ATS following June 23, 2017 will simply and solely reflect the volume of pre-matched trades within the Millennium ATS for trade reporting purposes. As of June 23, 2017, there will be no midpoint matching engine within the Millennium ATS and no continuous trading functionality. Millenniums Form ATS has been amended to reflect this change. As we move forward, we will be thoughtfully considering the best ways for our clients to access the increased and unique liquidity that Cowen will now be trading as a result of the Convergex acquisition. We understand that liquidity is tantamount to our clients, and we look forward to discussing new ideas with our clients in the coming months. If you have any questions on this or any other changes to the electronic trading offering, please reach out to Jason Oien (jason.oien@cowen.com, 415-646-7311) or your Cowen coverage. We thank you for your business, and we look forward to building on our valued relationship well into the future. Sincerely, Jeffrey M. Solomon President |
