AX Trading announced today that it had a record month of trading volume on The AX Trading Network ("The AX"). For the month, The AX traded 3.5M shares, more than double the 1.5M shares that traded on the new platform in July. In August, The AX completed 26 auctions in 11 different stocks with an average cross size of over 67,000 shares.
"August was a month of many firsts for The AX," said AX Trading CEO Kevin Callahan. “We had our first million share day, our first multi-party auction and our first after-hours auction. We could not be more pleased with the support we are getting from the institutional trading community for our new trading venue.”
For the month, AX members conducted 393 unique auctions with an average “initiated” order size of approximately 82,000 shares. This means that over 28M shares of actionable liquidity were posted on The AX for the month. The 3.5M shares that traded on The AX represent 12.5% of the shares put up for auction.
The AX Trading Network ("The AX") is the new Alternative Trading System (ATS) that allows professional traders to start their own auctions in any stock at any time. "Initiators" of AX auctions can also decide how much information to share about the auction and what counterparties to invite. AX is approved to trade all U.S. securities but does not trade pink sheet stocks.
Since The AX was launched in November 2011, AX members have conducted over 2,000 auctions representing over 180M shares of real, actionable block liquidity in a wide variety of mid, small and microcap stocks. The average market cap of stocks put up for auction on The AX is $1.8B and the average daily trading volume (ADV) is approximately 800,000 shares. With an average initiated over size of 88,000 shares, this means that the average “initiated” order on The AX represents more than 10% of the ADV of the stock.
Since launch, nearly one third of the auctions that have been completed on The AX have been done at prices that were outside of the market spread at the time of the auction. The AX is one of the only trading venues where institutional buyers and sellers can conduct block trades at the prices they want to trade at rather than simply being matched at the midpoint of a spread that may be narrow but also very thin, often as little as 100 shares a side.
"The element of true price discovery is proving to be one of the most attractive features of The AX Trading Network,” said AX Trading COO Jim Ross. “AX members describe it as truly liberating to be able to perform block trades at prices that are determined by the submittal of large, institutional orders rather than by small quotes posted by high-frequency traders."