Future of Exchanges: Opportunities and Challenges in Europe

SIX Swiss Exchange has once again partnered with Financial News to present a global platform for discussion featuring some of the industry’s leading personalities: The Future Of Exchanges – a Webcast Series.

The first edition in 2021 was moderated by Jack Otter (Global Head of Wealth & Asset Management, Dow Jones) and featured Graham Dick (CEO, Aquis Exchange Europe), Richard Worrell (Regional Head of European Equity Trading, Janus Henderson Investors) and Jennifer Hlad (Head of Equity Sales UK and Ireland, SIX Swiss Exchange).

Although Brexit has caused material disruption for euro-share trading in London, it is opening up potential opportunities for the UK and Switzerland to further cement their relationship. Earlier this year, the UK and Swiss authorities agreed on equivalence measures allowing for UK companies to be traded on Swiss venues, and vice versa. This comes following the EU’s refusal to grant equivalence to SIX Swiss Exchange back in 2019, which in turn resulted in the Swiss authorities banning EU venues from trading Swiss securities.

“With Brexit, the UK is now able to make agreements with other countries more freely. Some of the topics they are going to address were not on the agenda between the UK and Switzerland when they were part of the EU. So, it is an opportunity to really improve things and streamline processes. I think it could bring up a lot of opportunities,” noted Hlad.

Nonetheless, Brexit is creating other challenges for Switzerland, not least around market fragmentation. Hlad said that the UK had recently lowered the thresholds around pre-trade transparency for large-in-scale waivers. At the same time, the European Securities and Markets Authority (ESMA) has its own guidelines for large-in-scales. As a result, Hlad said there are now three distinctly separate regimes for large-in-scales in markets such as Switzerland, which she added is creating all sorts of confusion.

In order to thrive moving forward, financial market infrastructures will need to innovate. “On the digital side, one of the things we are hearing from market participants is that there is a need for a regulated digital market. SIX is in the process of obtaining regulatory approval for its digital exchange,” explained Hlad.

She highlighted that SIX Digital Exchange (SDX) – which will facilitate the listing, trading, custodying and settlement of digital assets – would help make transactional processes more efficient by leveraging existing trading technologies along with DLT (distributed ledger technology). “We have received lots of good feedback about our plans from the market,” she added.

While the video below provides a highlight reel, the full recording of the webinar is also available.

Discuss the Future of Exchanges with us: the next edition – focusing on The Future Of Asia – is scheduled for September; more details will soon become available on our dedicated event page.

Following a challenging year marked by growth and records, the Swiss stock exchange is proud to have been named Exchange Group of the Year at the Financial News Trading & Tech awards 2021. As a leading listing and trading destination, SIX Swiss Exchange has enjoyed enormous success over the past 18 months and delivered an extraordinary performance in an extraordinary year. Record-high volumes were managed without any problems, highlighting the outstanding reliability and dependability of its infrastructure while continuing to provide attractive financing opportunities for companies and enabling growth in its investment product segments.