Nasdaq (Nasdaq:NDAQ) has announced that Nasdaq Copenhagen is introducing a central counterparty participant for equity trading in its small cap market segment. The introduction removes bilateral counterparty risk, reduces transaction costs for trading members and aligns the post trade setup for equity trading on all main market segments at Nasdaq Copenhagen.
Improving market conditions for SMEs and growth companies is a pivotal priority for Nasdaq Nordic,” said Nikolaj Kosakewitsch, VP European Equity Sales & President of Nasdaq Copenhagen. “By doing away with bilateral arrangements in our small cap segment, we aim to attract more liquidity, narrow the spreads and lower the cost of capital for Nasdaq Copenhagen’s listed small cap companies. Just as we have done for our other main market segments.
In 2009 Nasdaq Nordic introduced the central counterparty participant for large cap shares in Copenhagen and Stockholm, and for all market cap segments in Helsinki. After the introduction, the share of non-Nordic trading in Nasdaq Copenhagen listed equities trippled from 25 pct. to 75 pct. In the same period the time-weighted average price spread for Copenhagen large caps dropped from 0.4 pct. to 0.09 pct.
We welcome Nasdaq’s commitment to improving access to this growth segment,” added Tue Østergaard, Head of Markets and Managing Partner at ABG Sundal Collier. “Improving accessibility for non-Nordic trading members will, all things being equal, improve liquidity into the small cap segment on the exchange, remove unnecessary barriers for greater liquidity and open the door to more investor interest.
The central counterparty participant for the Copenhagen small cap segment will be introduced at market open Monday November 19, 2018.