Spectrum Markets, the pan-European trading venue for securitised derivatives, has introduced a stop order functionality with customised features.
Compared to other venues, Spectrum’s stop orders functionality offers two advantages to investors. The venue will use the presence of market maker quotes in the order book as a trigger for stop orders, as opposed to the more commonly used last traded price. This means that orders may be triggered even in times of low trading volumes and in safe conditions in terms of fair price for the execution.
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A second feature allows investors the ability to select the side of the order book that triggers their stop order. Spectrum Markets is one of the first trading venues to introduce this feature. Both stop buy and stop sell (loss) orders can be chosen to be triggered by the offer- or the bid price. This opens up more choices and possible trading strategies for investors.
Both stop buy and stop sell orders can be either submitted as a stop market order or a stop limit order. Stop market orders will be executed at the best available price, against the available liquidity. This means that they may receive partial fills. Stop limit orders will be executed when their limit price is reached.
“Our tailor-made stop order options provide connected brokers with an additional method of opening and closing positions for their investors,” said Eren Eraslan, Head of Product Innovation at Spectrum Markets, “This functionality once again demonstrates our ability to innovate the trading of securitised derivatives.”
Spectrum Markets is a pan-European marketplace where retail investors can invest in structured products via their brokers. Since its launch, Spectrum’s trading services have been available in the following countries: Germany, France, Italy, Spain, Sweden, Norway, the Netherlands, Ireland and Belgium.