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European ETF providers create consolidated trading data

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Europe’s leading ETF providers, including Invesco, iShares, SPDR, DWS and Lyxor, have joined forces to provide investors with a ‘consolidated tape’ of aggregate ETF trading data in one place for the first time.

Driven by the increased demand for transparency in ETFs since the introduction of MiFID II at the beginning of 2018, the Bloomberg ETF Aggregate Volume feed incorporates over the-counter (OTC) trades as well as those listed on exchanges such as the LSE.

At launch, the service covers all European listed ETPs. The aggregated volume field shows the 90-day average aggregated volume across exchange and OTC venues and is updated on a daily basis. Led by the ETF issuer and trading community, the ETF providers that have come together include Invesco, iShares, SPDR and DWS.

Jim Goldie, EMEA Head of ETF Capital Markets, Invesco, says: “The obligation to report OTC trades in ETFs post-MiFID II has presented us, the industry, with an opportunity to demonstrate the true liquidity of ETFs to our clients. This has previously been a challenge as even though trades were being reported post MiFID II, there was no consolidated tape, which allowed clients an aggregated view of trading volumes in one place.”

The launch of the new service comes at a time of growth in Europe’s ETF market with total assets in ETFs and ETPs listed in Europe at USD783 billion in October, against the US figure of USD3.05 trillion in ETFs listed in the US. Fixed income ETFs and ETPs listed in Europe saw net inflows of USD946 million in October, bringing net inflows for 2018 to USD12.24 billion.

MIFID II, introduced across the European Union in January to improve market transparency and strengthen investor protection, made it possible for the first time to get an accurate assessment of all ETF trades across the continent, including the estimated 70 per cent of ETF trades that previously went unreported publicly because they were OTC.

Invesco believes that the increased transparency that MiFID II has brought is responsible for much greater use of ETFs by institutional investors in Europe.

Goldie adds: “The industry has come together for the benefit of all stakeholders to showcase the liquidity, transparency and strengths of the ETF market, and we expect this service to further catalyse the growth of the sector. European investors continue to invest in and benefit from ETFs and we as an industry are responding to that demand. We expect the consolidated trading volumes via Bloomberg will expand in 2019 and deliver additional functionalities and information.”

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