Oslo Børs: new trading system for equities and fixed income instruments

Oslo Børs: new trading system for equities and fixed income instruments

13/04/10

After a successful launch 12 April, Oslo Børs has now started to use the TradElect trading system for equities and fixed income securities together with the Infolect system for market data. The new trading system will make trading on Oslo Børs even more efficient, and will help to strengthen the Norwegian securities market, improve the profile of listed companies and increase the exchange’s competitiveness.

“An important element of our strategic partnership with the London Stock Exchange Group is using the same trading systems as the London Stock Exchange. Collaborating on technology strengthens our international distribution network, and helps to generate even greater interest in the Norwegian market”, explains Bente A. Landsnes, President and CEO of Oslo Børs.

"We are delighted that Oslo Børs' migration has been successfully completed. Our strategic partnership with Oslo is an important relationship for the Exchange and we are pleased to be able support Oslo Børs in its ongoing development of a more efficient and liquid Scandinavian marketplace.", says Xavier Rolet, Chief Executive of London Stock Exchange Group.

The strategic partnership between the London Stock Exchange Group (LSEG) and Oslo Børs was announced in March 2009. In December 2009, both Oslo Børs and LSEG’s subsidiary EDX London implemented the SOLA trading system for derivatives. Now that TradElect and Infolect are in production, all trading carried out on the marketplaces operated by Oslo Børs uses technology supplied by LSEG. Oslo Børs is an international marketplace, and foreign investors account for a large proportion of daily trading. More than half the exchange’s members are foreign investment firms, and a large proportion of these are based in London. TradElect has been in use for trading on the London Stock Exchange for several years, so many of the Oslo Børs member firms are already familiar with this system.

“The London Stock Exchange has over 400 members, and we believe that Oslo Børs will now be able to attract even more investment firms as members and so increase both distribution and liquidity for our marketplaces”, adds Bente A. Landsnes.

The migration to the new trading system for Oslo Børs has been a large and complex project involving many parties. In addition to modifications for the related in-house systems at Oslo Børs and the transfer of operating services for the trading system from Stockholm to London, the migration has made it necessary for member firms, information distributors and third-party suppliers to make significant changes.

“We are very pleased that the launch of the new trading system has been a success, and we would like to thank everyone who has worked hard over recent months to make this possible. As with every major technology project, we ran into both small and large challenges along the way, but the project benefited from constructive dialogue and good collaboration with our customers and other partners, and not least the LSEG. We now look forward the continuing development of our partnership with London”, says Bente A. Landsnes.

Simultaneously with the migration to the new trading system, new membership and trading rules came into force for Oslo Børs members. The new rules replace the joint NOREX rules for the Nordic exchanges that Oslo Børs has used since 2002. The new membership and trading rules are based on the LSE rules, but with some changes to reflect Norwegian requirements.

The most important change that the new trading system will cause for investors is the abolition of post-trade anonymity for the OBX category. Post-trade anonymity was introduced in June 2008, but from April 12 all transactions in equities, warrants and ETFs traded on Oslo Børs will be fully transparent. The OBX category normally comprises the 25 most heavily traded shares on Oslo Børs. In addition, the ‘round lot’ of shares has disappeared. ‘Lot size 1’ will be the standard for all equities, and ‘odd lot’ orders have also disappeared. This means that in TradElect the minimum order size will be one share.