Wednesday, January 27, 2010

Hughes: Paris in ambitious bid to launch new French revolution

"...The venture is bringing together issuers, investors, trading platforms, banks and brokers in an effort to produce a new trading model. Initially begun by investors talking directly to issuers, the plans are now being fronted by Paris Europlace, an industry body that promotes Paris as a financial centre...

A focus on liquidity provision could include investors undertaking to support the market by inputting firm trading requests rather than fishing for prices with little intention of trading, a practice that makes it hard to know how firm the market price is. A group of large French companies has already agreed to register more of their bonds in Paris rather than London or Luxembourg. There are also suggestions their commitment to the project could include undertaking to issue regular bonds in certain sizes to help with liquidity, which in turn would help give participants confidence in the prices displayed.

Those involved say the project will include pre- and post-trade facilities. Pre-trade would include bond prospectuses but, more importantly, some form of "order book", such as those which are common on equity exchanges, where traders post orders and others can then see the "depth" of the market..."

No comments:

Post a Comment