Investment Technology Group, major US technology-based trading company, is engaged in talks with French bank Societe Generale about setting up a 50/50 joint venture to set up an electronic equity-matching system in Europe. The system will be modeled on POSIT, which ITG says is used by more than 400 institutions and brokers in the US to trade more than 20 million shares a day. It exists alongside, and complements, the traditional order driven system and buy and sell orders are matched electronically twice a day at real-time market prices. The big advantage of the system is that as the transaction is anonymous it has no impact on market prices and is executed at the mid-point of the big offer spread, giving savings to both parties. ITG developed POSIT with BARRA Inc, a provider of analytical models, software and money management systems.
