Huge amounts of share trading normally done through banks or anonymous marketplaces shifted back on to exchanges in March, as traders opted not to wait for end-of-day auctions to dump positions.
Monthly data showed that activity on exchanges and other public venues surged amid the ferociously volatile month, in which the US benchmark S&P 500 made its quickest ever descent into a bear market, while the FTSE 100 recorded its worst quarter since 1987.
Average daily trading volumes across exchanges in Europe soared to €69bn in March, a 60 per cent year-on-year increase, according to data from Cboe Europe.
Germany’s Xetra traded €259.6bn for the month, the highest level since January 2008, according to Deutsche Börse. The London Stock Exchange traded in excess of £10bn of deals several times in March, more than double its daily average of £4.6bn last year.
Those gains have largely been made because fund managers have used the former monopolies to trade shares, instead of using banks or high-frequency traders.
The market share for exchanges and other marketplaces known as multilateral trading facilities had slipped as low as 45 per cent in December but rose to 54 per cent in March, according to data from Big XYT, a data provider, as investors used them to get in and out of positions rapidly.
Peter Sleep, senior portfolio manager at Seven Investment Management, said in more normal markets large asset holders would be happy to trade anonymously, and wait for the best price and lowest cost. Typically, they…