Boston, MA, September 30, 2009
– A new report from Aite Group, LLC examines key trends within the U.S. dark pool market and highlights the major changes that have impacted the space over the last 12 months. Based on Aite Group interviews with key market participants and 27 dark pools,
the report also profiles 26 dark pools, each with trade volume and high-level workflow.
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Defined as execution venues that do not provide public quotes, dark pools' core value is their ability to provide access to liquidity while minimizing market impact. Over the last 12 to
18 months, this rather restrictive definition of a dark pool has been challenged, given that an increasing number of dark pool users appear to be willing to live with a certain level of market impact in return for higher fill rates.
With increasing use of outbound and inbound indication of interests (IOIs) within some dark pools, it is not currently clear whether the traditional definition of a dark pool still applies to a majority of the venues. Only two things about
dark pools are clear at this time: their overall market share continues to grow, and regulatory intervention appears inevitable.
"As the evolution of the dark pool market continues, the initial focus of dark pools providing alternative venues for facilitating block trading has transformed into a dynamic marketplace with diverse business models and
technology innovations," says Sang Lee, managing partner with Aite Group and author of this report. "For the active users of dark pools, the trade-off between
the potential for information leakage and increased chances for a fill must be carefully considered. This simple, yet crucial consideration will ultimately help determine the winners and losers in the dark pool market."
The report profiles 26 dark pools within five categories: block trading dark pools (Aqua, BlockCross, ConvergEx Cross, ITG POSIT, Liquidnet and Pipeline), agency dark pools (ConvergEx VortEx, Instinet CBX, Knight Match,
NYFIX Millennium, SIG RiverCross and SunGard Assent ATS), consortium dark pools (BIDS and Level ATS), exchange dark pools (ISE MidPoint Match, NASDAQ Crossing and NYSE MatchPoint), and internalization dark pools (Citi Match, Credit Suisse
Crossfinder, GETCO Execution Services, Knight Link, Barclays Liquidity Cross, Bank of America Merrill Lynch MLXN, Morgan Stanley MS Pool, UBS PIN and Goldman Sachs Sigma X).
This 68-page Impact Report contains 52 figures and nine tables. Clients of Aite Group's Institutional Securities & Investments service can download the report by clicking on the icon to the
right. 
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