Electronic trades get speed boost

The 300-year-old London Stock Exchange (LSE) is continuing to update its electronic trading platform.

According to Dame Clara Furse, who stepped down as CEO of the exchange yesterday, new functionality is expected to be added to the LSE's TradElect electronic trading platform.

Speaking at the announcement of the LSE's full year 2009 results, Furse revealed latency of TradElect "continues to decline" - down to 3.7 milliseconds, with capacity increased threefold to 18,000 messages per second following an upgrade to the system earlier this month.

The upgrades to the system come following the merger of the LSE with Borsa Italiana in 2007. Late last year, the Italian stock exchange's cash equities trading was moved into TradElect.

"Barely a year after the completion of the merger, last November we moved Italian equity trading onto TradElect. We are proud of this speedy and successful migration and I'm particularly grateful to the IT team…for their hard work and dedication," Furse said.

The company expects to move Italian exchange traded funds, retail fixed income and securitised derivatives markets to TradElect in the first quarter of the current financial year.

TradElect will also form the backbone of the LSE's upcoming pan-European dark liquidity trading venue Baikal.

Baikal, which is expected to launch this summer, will use "smart order routing and algorithmic order entry/trading strategies from specialist technology firms", according to the LSE's results.

The LSE's incoming CEO, Xavier Rolet said the exchange is already looking for the next technology developments.

"We are also seeing the continued growth in technology-intensive, high-frequency trading making our technology strategy even more important. Indeed, such is the pace of change in our industry, we are already planning what will be the next step change in the technology space," he said.