JSE opens way for Europe electronic trading

London - The Johannesburg Stock Exchange (JSE) has struck a deal with British technology firm Fixnetix that will enable Europe’s top trading firms to post orders directly on the JSE from outside South Africa for the first time.

The JSE Ltd [JSE:JSE] said on Thursday it had signed an agreement with Fixnetix under which the trading systems expert will act as the exchange’s electronic gateway for European banks and brokers from early 2012.

The exchange also said in an emailed statement it planned in July next year to upgrade from its current platform, hosted by the London Stock Exchange, to a newer offering from the British exchange.

“The agreement with Fixnetix and the new trading system will offer improved access to the JSE markets and may play a role in the JSE competing for trading volumes,” said the JSE’s head of equities Leanne Parsons.

Fixnetix will provide access to the JSE order book, via a technological gateway called a point of presence (POP), from a data centre just outside London, while the main trade matching system will be hosted in Johannesburg, the JSE added.

“In future, the JSE may also offer clients the ability to connect to other networks and POPs, making it even easier for offshore clients to trade on the JSE,” Parsons said.

Investment banks and high-frequency trading firms rely on super-fast trading services from the world’s top exchanges to make their strategies work, while the exchanges are keen to attract these firms to boost their dwindling trading revenues.

The LSE and its rivals NYSE Euronext and Deutsche Boerse have been investing heavily in their trading systems over recent years to keep pace with Europe’s new breed of alternative exchanges, such as Chi-X and Bats Europe.