Direct Edge

Last updated
Direct Edge
Type Stock exchange
Location Jersey City, New Jersey, United States
Founded1998 (1998)
Closed2014 (2014)
Owner BATS Global Markets
Key peopleWilliam O’Brien (Chief Executive Officer), Bryan Harkins (Chief Operating Officer). [1]
Currency United States Dollar (USD)
IndicesUS Equity indices
Website www.directedge.com [ dead link ]

Direct Edge was an American stock exchange that operated two separate platforms, EDGA Exchange and EDGX Exchange. [2] It was based in Jersey City, New Jersey and merged with BATS Global Markets in 2014.

Contents

Beginning in March 2009, Direct Edge's market share ranged from 9% to 12% of U.S. equities trading volume, and regularly traded one to two billion shares per day. Before their merger, Direct Edge jockeyed with BATS Trading to be the third largest stock market in the United States, behind the New York Stock Exchange and NASDAQ.

History

Foundation as ECN

The firm began in 1998 as an electronic communication network (ECN) under the name Attain. In 2005, the assets of Attain were purchased by Knight Capital Group and subsequently spun off two years later as the re-branded Direct Edge ECN. The spin-off brought in new management as well as new ownership—Citadel Derivatives Group and Goldman Sachs were brought in as partners alongside Knight. The partnership was further diluted when in 2008 the International Securities Exchange relinquished operational control of their stock exchange arm to Direct Edge in return for a 31.5% stake. [3]

On March 12, 2010, Direct Edge received official approval from the U.S. Securities and Exchange Commission (SEC) to convert both EDGA and EDGX ECN platforms into two newly established national securities exchanges. [4] In July 2010, Direct Edge successfully made the transition, decommissioning both ECN platforms and the ISE Stock Exchange, leaving what is now America’s newest stock exchange. [5]

Milestones 2009 - 2011

In November 2011 Direct Edge annunciated intention to open a stock exchange outside the United States, in Rio de Janeiro, Brazil, in the last quarter of 2012. [10]

Merger 2014

On January 31, 2014, BATS Global Markets and Direct Edge completed a merger, with the combined company using the BATS Global Markets name. [11]

Trading

Direct Edge traded all U.S.-listed equities:

EDGX is an exchange with a maker/taker pricing model offering high rebates for liquidity providers. EDGA is a low cost exchange with a taker/maker pricing model. [12]

Hours of operation are from 8 a.m. to 8 p.m. with the regular trading session designated between the hours of 9:30 a.m. and 4 p.m. EDGA is identified as “J” for all trades and quotes posted to the Security Information Processor (public quote stream) and EDGX is identified as “K”.

See also

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References

  1. "Direct Edge Announces Promotion of Bryan Harkins to Chief Operating Officer". NBC News. 2010. Retrieved 10 October 2020.
  2. "Direct Edge Says IPO Possible After Exchange Status". Bloomberg Businessweek. 21 July 2010. Archived from the original on 2011-09-13.
  3. "Direct Edge and ISE Stock Exchange to Form Single Market". Traders Magazine. 22 August 2008. Archived from the original on 23 August 2010. Retrieved 24 August 2010.
  4. "Direct Edge set to Become 4th US Stock Exchange". Reuters. 12 March 2010.
  5. "Now an Exchange, Direct Edge Looks to Add Revenue and Cut Costs". Traders Magazine. 22 July 2010. Archived from the original on 12 August 2010. Retrieved 24 August 2010.
  6. "Direct Edge Matches Once Billion Shares, Edging Closer to Competition". Advanced Trading. 12 February 2010. Archived from the original on 29 July 2012.
  7. "Direct Edge Rides Citi to Record Trading Shares". Wall Street Journal. 4 September 2009.
  8. "Direct Edge See Jump in Trading". Wall Street Journal. 17 March 2009.
  9. "Direct Edge Completes Exchange Transition". The Trade News. 21 July 2010. Archived from the original on 8 January 2011. Retrieved 24 August 2010.
  10. "Direct Edge plans Brazilian launch". Financial Times. 21 November 2011.
  11. "BATS Global Markets and Direct Edge Complete Merger" (PDF). 3 February 2014.
  12. http://www.brainshark.com/DCS/vu?pi=zGwzPWcfUz3QRKz0