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Technology is shifting the landscape of capital markets. Automation and digital transformation are table stakes; trading and investing firms are shedding legacy systems and eyeing cloud, AI and other emerging technologies for efficiency and optimization.
With that dynamic backdrop, Markets Media Group is pleased to collaborate with Adaptive on a capital markets industry survey aimed at better understanding how technology resources are being deployed currently, and how resources will be deployed in the future.
Participation is anonymous and the aggregate results will be published though Markets Media titles to support a wider understanding of technology deployment today.
The survey takes the pulse of market participants and technologists on critical topics such as the state of tech modernization across the industry; key factors driving modernization; the ongoing buy vs. build dynamic; relationships with tech vendors; and adoption of AI, blockchain, cloud and open-source software.
Matt Barrett, CEO and Co-founder of Adaptive.
“Over the past few years, there has been a distinct shift in attitudes when it comes to legacy vendor technology, and increasing demand for differentiation, control and innovation potential,” said Matt Barrett, CEO and Co-founder of Adaptive. “These shifting attitudes have been driven by advances in the cloud, tech accelerators, modular design, the increasing prevalence of open-source technology, and the growing opportunities presented by AI for enhanced decision-making and operational efficiency.”
“These trends are disrupting the industry by driving innovation and cutting development and operational costs,” Barrett continued. “Through our collaboration with Markets Media, we aim to discover how these technological advancements coupled with market drivers are shaping attitudes, decision-making and deployment patterns.”
The survey will provide a snapshot of ever-changing technology resource deployment in capital markets, in turn enabling participants to benchmark their approach and activity versus peers, and better understand tech procurement decisions and attitudes toward emerging technologies. The output will also help identify which important tech trends are flying under the radar, and which trends may be overhyped.
The survey should take less than 10 minutes to complete. Markets Media and Adaptive thank you for your participation.
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BNPParibas’s €5.1bn purchase of AXAInvestmentManagers (AXAIM) is increasingly reliant on a 15-year distribution deal with fund group’s insurer parent, that insulates the bank against customer flight towards lower fee funds.
The takeover would boost BNP Paribas Asset Management’s footprint from €604 billion to €1.5 trillion and BNP would jump into Europe’s top three asset managers overnight. It would also turn its Insurance & Protection Services (IPS) division into “the biggest growth driver for the group in the next few years”, chief financial officer Lars Machenil said on a 24 April investor call.
The deal is two-pronged, with on the one hand a 15-year distribution agreement and on the other hand the folding of AXA IM into BNP’s IPS division. BNP had hoped to offset the reduction in capital by using the so-called Danish Compromise, a European tweak to Basel banking rules that allows banks to avoid deducting the value of insurance subsidiaries from capital.
In an interview published on the European Central Bank’s website in April, chair of the supervisory board Claudia Buch, poured cold water on BNP’s ambitions, stating that “it’s intended to be applied to the insurance sector and not to, for example, asset management undertakings”. BNP says discussions are “ongoing” and insists its plans will still allow for capital to be returned to shareholders. “We have already received the ECB’s green light for a €1 billion share buyback that will launch in Q2,” Machenil reminded investors on the same call.
Without the capital benefit, BNP’s acquisition depends more upon its 15-year agreement to step into Axa IM’s shoes as manager of the assets backing Axa’s insurance liabilities. Having such a captive client gives the bank protection against customer flight towards lower-cost fund providers and exchange-traded funds.
Among European fund groups, Axa IM is particularly dependent on high fees, analysis by Global Trading shows.
AXA IM currently manages about €895 billion across fixed income, multi assets, equity and private markets franchises, and earned net revenues of €1.6 billion in 2024. Its funds, of which in our sample 29 % of assets are allocated to equity, command the highest average fees amongst those reviewed from UBS, Legal & General, Allianz and Amundi: 0.75 % versus Amundi’s 0.65 % and LGIM’s 0.32 %.
Peer snapshot (funds listed on Bloomberg):
Data covers only funds that are individually listed on Bloomberg and whose parents were searched for. Blended fees are calculated only for the subset of funds with a disclosed AUM, so rates may differ from group actual global fees.
Even without M&A, European asset managers grew in 2024, but the money did not land evenly.
“2024 was a record year—€55 billions of net inflows, with every client segment contributing and AuM topping €2.2 trillion,” Amundi chief executive Valérie Baudson said on her results call on 4 February.
“Bond funds did the heavy lifting: Allianz Group enjoyed €70 billion inflows at PIMCO that more than offset equity redemptions at Allianz GI,” Allianz SE CFO Giulio Terzariol told analysts on 28 February.
And Suni Harford, president of UBS Asset Management, noted on the 6 February call that “The integration of Credit Suisse’s funds is running ahead of plan; we captured CHF29.5 billion of net new money in 2024 even as consolidation costs peaked.”.
Against that backdrop BNP AM registered €15 billion inflows and closed the year on €604 billions of AUM. Both Axa and BNP declined to comment.
Fewer firms are listing on European markets. Yet the assumption that they are opting for the other side of the Atlantic may be incorrect, according to recent research from HSBC and New Financial.
A recent report from the two firms stated that, over the last decade, 130 European companies had shifted to a US stock market listing. By contrast, over the same timeframe 1,013 European companies have delisted after being acquired by privately held or private equity firms.
Ian Stuart, CEO of HSBC UK Bank, commented: “This represents a combined loss of value of over US$1 trillion in today’s money. The inability of public markets adequately to recognise the value of companies on such a scale is problematic.”
According to Bloomberg data, in April alone buyers in 16 of the 46 M&A deals announced (34%) were private equity. Year-to-date, this figure is 65 of 178 – 37%.
There is significant disparity between the scale of economic impact that these two forms of European exit have had. The 130 firms moving to the US represent just 4% of European stock market value.
Reports from the Association for Financial Markets in Europe (AFME) last month found that the value of IPOs listed on European exchanges in 2025 so far was down 26% year-on-year, and that European and UK exchanges combined represented an average of just 10% of IPO issuance each month.
This follows efforts from the European Council to keep firms on public European markets, with the listing act introduced last year.
Notable public acquisitions over April include US firm DoorDash’s acquisition of UK firm Deliveroo for US$3 billion, and Swiss insurance firm Baloise Holding’s sale to Helvetica Holding for US$1 billion.
The value of individual private deals has been subdued by comparison, with the largest over April being the US$1.2 billion acquisition of Danish towage and marine services provider Svitzer. Real estate firm Amara Group was the second largest with a US$613 million deal – almost half the size of Svitzer.
Collectively, just under 10% of April’s US$40.6 billion in deals was generated by private buyers.
In order to return listings to Europe, HSBC and New Financial emphasise the importance of simplifying market infrastructure, consolidating regulation and introducing broader economic reforms in line with 2024’s Draghi and Letta reports on European competitiveness.
Part of this includes increasing institutional and investor engagement in European markets, as is the goal of the European Commission’s savings and investments union (SIU).
Matt Howell, global head of trading strategy, T Rowe Price
Matt Howell has been promoted to global head of trading strategy at T Rowe Price.
“I am looking forward to further developing our capabilities to support our strategic initiatives over the coming months and years,” he told Global Trading.
T Rowe Price reported US$1.8 billion in net revenues over 2024, with approximately US$1.6 billion in assets under management.
Howell has been a trader at T Rowe Price since 2010, becoming global head of derivatives and multi-asset trading solutions in 2017.
Earlier in his career, he was a cross-asset trader at Caxton Associates and an equity trader at Tudor Investment Corporation and AllianceBernstein.
Craig Donohue has been named Cboe Global Markets CEO, effective 7 May.
He replaces Fredric Tomczyk, who has held the role since 2023. Tomczyk will take on an advisory role until the end of June, and will remain a member of the board.
Donohue has more than three decades of industry experience, and led CME Group from 2004 to 2012.
He has spent the past 11 years with the Options Clearing Corporation (OCC). Joining as executive chairman in 2014, he later spent three years as CEO and was appointed chairman of the board in January 2024.
Elsewhere at Cboe, Natan Tiefenbrun was recently promoted to global head of cash equities.
SEC rules have made the United States the gold standard for best execution transparency. Mark Davies, CEO of data firm S3 shares his insights into the rules, how they are changing and potential applications for non-US trading firms.
How do SEC Rules 605 and 606 work in the US and how does it relate to best execution practices?
Mark Davies
SEC Rules 605 and 606 each have distinct requirements, but work in tandem to enhance transparency and help investors, regulators, and brokers assess execution quality. Rule 605 provides data to help brokers and investors compare execution quality across venues, while Rule 606 ensures brokers are transparent about how they route orders. Together, these rules encourage competition and efficiency in the marketplace.
How does Rule 605 work?
Rule 605 requires market centres (exchanges, market makers, wholesalers, and ATSs) to publicly report execution quality statistics for covered orders in NMS stocks. “Covered orders” are market orders and limit orders that are immediately executable (marketable orders). 605 reports must include price improvement, effective spread, execution speed, and fill rates, and all of the data must be broken down by trade size. These reports must be publicly published on a monthly basis so that brokers and investors can compare the performance of market centres.
In March of 2024 the SEC approved amendments to modernise Rule 605 by enhancing transparency, adapting to technological advancements, and ensuring that execution quality metrics align with the complexities of modern trading environments. Some of the most significant changes include:
Broadening the definition of a “covered order” – now includes certain orders submitted outside regular trading hours, orders with stop prices, and non-exempt short sale orders
Creating new order size categories – instead of share quantity, the report will now show notional dollar value, and will make a distinction between fractional shares, odd-lots, and round lots
Requiring much more granular reporting metrics – execution times will now be reported using millisecond or finer timestamps (microseconds/nanoseconds), realised spread stats will be calculated using additional time horizons ranging from less than 100 microseconds to 5 minutes after order receipt
Expanding the scope of who must report – now, in addition to market centres, “large” broker dealers that hold 100,000 or more customer accounts will be required to produce a 605 report
The new requirements will go into effect in December of 2025.
Explain how Rule 606 and the best execution obligation works in the US:
Rule 606 requires broker-dealers to publicly disclose how they route and execute customer orders in NMS stocks and listed options. The best execution obligation requires broker-dealers to seek the most favourable terms reasonably available for customer orders. So, this could mean routing customer orders to an execution venue that has a higher rate of price improvement, or routing large institutional orders to a dark pool or ATS instead of an exchange to avoid moving the market and getting a worse price. In addition to the required disclosures, FINRA-registered firms must regularly review their execution quality, compare venues, monitor payment for order flow, and make adjustments as needed.
This is where S3 comes in. We provide the tools needed to efficiently and effectively perform these best execution reviews. A broker can use S3’s software to perform reviews of their execution partners, and for example, notice a trend of consistently delayed executions leading to poor fill prices during volatile market conditions. That broker can then change its routing practices to send more of their order flow to a more consistently performing partner. S3’s GUI makes it easy to spot trends or exceptions, and track those changes right in the portal. BDs can then adjust their routing behaviour accordingly, while also showing to internal best execution committees or even regulators that they are closely monitoring and optimising execution quality.
We process data for the vast majority of the top market participants in the US – clients use our web-based portal to monitor execution quality and build reports that help to make routing decisions as well as satisfy their regulatory obligations. Regulatory supervision requires the review process to be pre-defined and then documented to show that it’s being followed. The S3 portal features an audit trail function where users can track exceptions and save comments, and then download a file as evidence for regulators. The platform is very intuitive and user-friendly, and simplifies a data-heavy process into something much more manageable.
Why do the changes to 605 matter and why now?
The update to 605 is particularly timely now that retail trading volumes have experienced such a notable surge in recent years, due to several factors. Mobile trading Apps (like Robinhood) have made it easy for people to trade anytime, anywhere. Social media platforms like Reddit and TikTok have become hubs for investment discussions, fostering a community-driven investment culture. The “meme stocks” phenomenon was driven by chatter amongst online communities that made coordinated buying efforts, leading to significant price movements in stocks like GameStop (GME). Many people started exploring stock trading as a new activity after spending so much time at home during pandemic lockdowns. The ability to purchase fractional shares has made investing in high-priced stocks more accessible to retail investors with limited capital. All this combined with zero-commission trading has created an environment where truly anyone can trade.
Rule 606 was last updated in 2018, but Rule 605 hasn’t been changed significantly since its inception in 2000. With the innovations in trading and technology advancements that have occurred in the last 25 years, combined with the recent uptick in retail trading activity, the time has come for the disclosures to catch up.
How is S3’s US best execution reporting software being adapted for non-US clients?
One of our clients, a large US-based bulge bracket bank, asked us to partner with them to develop a best execution product for their global business. They had struggled to find an existing provider of best execution & TCA software that performed as well as the S3 best execution software they use to analyse their US order flow. Because of the profile and global footprint of this client, we realised this approach could be used by other US firms trading globally, as well as UK and European-based firms trading domestically or in the US.
With the elimination of RTS 27 & 28 in the UK, there is an opportunity for firms to pave their own way in terms of how they evaluate execution quality, and to show to regulators (and clients) that they are using a process driven by meaningful data. The increasing globalisation of trading can only mean a need for more transparency and a more streamlined approach to best execution, with more granular execution quality metrics and user-friendly review applications. Increased transparency helps traders make better-informed decisions, resulting in better executions, a reduction in hidden costs, and a more competitive marketplace overall. As the leading provider of best execution analytics and reporting disclosures in the US, S3 is well-positioned to help firms worldwide looking to ensure investor protection in any jurisdiction.
Equity trading revenues rose across the board in Q1 2025 in the buildup to US tariff adoptions. UBS continued to lead the pack with a reported €1.6 billion, up more than a third (34%) year-on-year (YoY).
Increasing revenues across the banks mirror those seen in the US over Q1, where QoQ gains significantly outpaced YoY comparisons.
UBS’s success was driven by activity in equities derivatives, the firm stated in its earnings call, along with increases in cash equity and prime brokerage results. The bank’s Q1 2025 results also represented a 25% increase quarter-on-quarter (QoQ).
CEO Sergio Ermotti observed: “As the second quarter kicked off, the unveiling of significant changes to tariffs on trading partners by the US administration increased uncertainty and market volatility, while in some days trading volumes exceeded their COVID-era peak by around 30%.”
Non-US Bank Results Q1
On the other end of the scale, HSBC floundered behind the European giants, reporting €431.9 million in the first three months of the year. Despite this marking significant quarterly growth for the bank, up 82%, it still left a more than a half-billion gap between the three banks at the centre of the pack – Societe Generale, Barclays and BNP Paribas.
Questioned on the impact US tariffs have had on client behaviour, Georges Elhedery commented: “Corporate customers are in a wait-and-see mode, so some of the capex or large investments are on hold. Certainly, some of the shipments from China, specifically to the US, have slowed down, but we’ve seen no panic. So there’s been no significant drawdowns. Deposit behaviour has remained normal, so nothing really to call out beyond the wait and see.”
For the firm, he added: “In a plausible downside tariff scenario, we estimate that there will be a low-single-digit percentage impact on the group’s revenues.”
As of Q1 2025, HSBC has ceased breaking out trading revenue into equities and fixed income. Figures for the first three months of the year have been estimated based on 2024 breakdowns.
Barclays, which has seen the most drastic variations in results since Q3 2023, saw equity trading revenues increase 59% QoQ but just 9% YoY to €1.1 billion.
Rising more steadily, both Societe Generale and BNP Paribas equity trading revenue results were up 22% YoY, to €1 billion and €1.2 billion respectively. On a quarterly basis, growth was more pronounced at BNP Paribas – up 43% – than at Societe Generale, up 28% to a record high.
Sitting just above HSBC, Nomura reported €606 million in the first three months of the year – rising just 6% QoQ but 45% YoY, in line with slow but steady growth over recent quarters.
IPO issuance was down 56% in April, closing out the month with US$4.1 billion across currencies according to Bloomberg data.
A total US$9.3 billion was issued in March.
The market bounced back somewhat in the final week of April, rising from US$2.3 billion as of 24 April.
The bulk – US$2.6 billion’s worth – of IPOs were issued in USD, while the Saudi Riyal took a distant second place with US$202 million.
IPOs by currency
Secondary offerings fell in tandem, with a reported US$10.4 billion across currencies as of 24 April. This figure was US$62.6 billion in March.
In the secondary market, the last offering exceeding US$1 billion came from broker-dealer LPL Financial on 31 March. The US$1.5 billion in common stock was listed on the Nasdaq Global Select Market. Slightly earlier, on 24 March, a US$5.5 billion offering of Class B shares was made in Hong Kong dollars by technology company Xiaomi Corp, making the currency the second most used over the month.
The total value of IPOs year-to-date is US$63.2 billion. One of the largest contributors has been the Swedish Krona, which represented US$1.6 billion in IPOs since January. SEK was also the currency of the most recent IPO in excess of US$1 billion, issued on 27 March by Asker Healthcare.
Across European exchanges, IPO values fell by 36% year-on-year (YoY) to €3.2 billion in deal value over Q1 2025 according to the Association for Financial Markets in Europe (AFME) – significantly below the Q1 average of €6.4 billion that has been held since 2015. Secondary offerings, by contrast, were up 31% YoY to €30.3 billion.
Between October 2023 and 2024, Europe accounted for 10% of all IPOs globally. Considering the last 12 months, this figure has fallen to 7.4%.
On average, year-to-date European and UK exchanges have represented 10% of IPO issuance each month. In March they took almost a fifth (19.4%) of the pie.
This trend may be proving AFME right in its claims that the listing act introduced by the European Council in October last year, designed to keep IPOs in Europe, is not effective.
Considering the impact of US tariffs introduced at the start of April, AFME stated that, for the first half of the month: “IPO issuance and M&A activity have not been visibly impacted by the introduction of tariffs so far, as IPO and M&A deal values for the first part of April continued at levels similar to those observed in previous years.”
When questioned by Global Trading on this conclusion, a spokesperson for the association commented: “There was indeed a pause in the first half of April. However, it’s very challenging to attribute this only to tariffs since the European market has been quite subdued for several years now. One might have expected that the price dislocation would cause a significant drop in IPOs, but it’s hard to see a sharp decline in something that has already hit rock bottom! Interestingly, the number of IPOs in April 2025 is the same as in April 2024.”
Globally, 2024 data indicated that IPOs were concentrating in India and the Middle East.
According to Bloomberg data, year-to-date Indian rupee-denominated IPOs have contributed US$1 billion to the global total in 2025, surpassed by the Japanese yen (US$3.2 billion) and the South Korean won (US$1.8 billion).
The Financial Conduct Authority (FCA) is expected to decide whether AIFMD and UCITS funds will be granted the same research payment optionality as MiFID-governed firms next month.
“Buy side firms have been on a MiFID II rollercoaster ride so far,” Mike Carrodus, CEO of Substantive Research, recalled. “There was a feeling that regulation has been too heavy, but now we may move to a place of greater flexibility for research budgeting, balanced with continuing controls around governance and value for end investors.”
“Without alignment across the rules governing both segregated mandates as well as pooled funds, the group that will or can go to joint payments is naturally constrained within a smaller universe,” Carrodus explained. “But what is the point of softening these rules if they are unworkable?”
“The whole point is to have a single process, otherwise the motivation to make the transition to joint payments will be removed for many,” he said. “Clients are hopeful that strategy- or firm-level budgeting for research for pooled funds will be confirmed this May but we’ll have to wait and see.”
In November 2024, the FCA’s consultation paper on the Conduct of Business Sourcebook (COBS) 2 proposed relaxing its rules so that individual investors need only be informed, rather than explicitly consent to, changes in research payments.
“That concession was quite a big one,” Carrodus said. “It could be that making the second concession to budget at a strategy or firm level instead of a fund level felt like too big a step, so the consultation paper didn’t include it. That caused quite a lot of consternation.”
At the moment, many clients are “positively predisposed” to making the move, he said. “While many don’t want to be in the first wave of firms moving across, they’re now in the mindset of actively looking for things that confirm that this is going to be okay.”
“If and when we get the confirmation that strategy or firm-level budgeting in May is acceptable, it will be full steam ahead for earlier adopters. Not all of them will make it by the end of this year because, like all things, when you actually start a complex change process you encounter complications.”
He referenced Chancellor Rachel Reeves’s letter to FCA CEO Nikhil Rathi earlier this year, which emphasised the need to avoid over regulation and boost competitiveness of the UK market.
The deregulation drive is being adopted more broadly, with the FCA recently proposing slashing 70% of the regulatory capital rules text as it seeks to simplify its rulebook.
Regulatory capital rules require investment firms to hold an amount of capital in particular types of funds that will allow them to absorb losses and remain resilient during times of stress.
Initially designed for banks, the FCA states that the rules are overly complex and not suited to investment firms’ business models.
As such, it argues, the legal text can be condensed by almost three quarters. If accepted, the proposal will see EU-derived elements of the rules removed.
Capital requirements will remain unchanged, and the authority does not expect firms to change their capital arrangements as a result of the amendments.
Trading Technologies’ path to compete against trading software giants like ION and FIS has received qualified backing, as its investing partners SGX and CBOE have so far declined to exercise call options to buy the firm. The potential acquisition had been flagged by analysts at BofA.
Trading Technologies (TT) was acquired by private-equity house 7Ridge in 2021. Cboe, a limited partner in the 7Ridge fund, negotiated an exit option that could be triggered either when TT hit pre-set performance goals or from 21 December 2026. Those targets were met during a two-month window that started January, meaning Cboe can now exercise the exit option and take over TT, otherwise TT will remain independent as it seeks to take on industry competitors such as ION Markets.
Speaking to analysts on a 2 May earnings call, Cboe CFO Jill Griebenow was non-committal: “We look at things that make strategic and financial sense. The option hasn’t expired, and we have not exercised it.”
A source close to 7Ridge said, “To develop TT in a direction that was good for the market, 7Ridge set expectations with the other investors via an agreed set of KPIs, based on TT’s development in a direction that would be good for the industry and for the market.”
SGX and CBOE as investors could potentially make their clients’ lives easier and therefore see more business by supporting the development of the system in that way, the source added.
7Ridge Investments 3 LP acquired TT in late 2021, in a deal that valued the futures-trading Order Execution Management System (OEMS) at US$500 million. Cboe supplied 40 per cent of the fund’s capital and has treated the stake as an equity-method investment ever since.
Under the partnership agreement, Cboe secured an exit option allowing it, or any other limited partner, to buy 100 % of TT once the business either satisfied defined revenue and profitability hurdles or after 21 December 2026. Cboe’s latest 10-K filing described the mechanism in detail, noting that if the LPs decline to exercise, 7Ridge can put TT up for sale to a third party instead.
That clock accelerated in January 2025 when Cboe disclosed that the general partner certified the performance goals have been achieved, and the option became exercisable.
Bank of America analysts highlighted the disclosure in a mid-April note:
“In their latest annual filing, Cboe disclosed that its exit option to acquire Trading Technologies became exercisable in January.”
The report adds that Cboe’s “dry powder spiked 28 % quarter on quarter,” giving the group ample balance-sheet capacity to fund a larger deal after years of sub-US$500 million acquisitions
TT itself has grown rapidly; revenues climbed from US$98 million in 2021 to US$170 million in 2023. OEMS transactions in comparable deals have cleared about seven- or eight-times sales, implying a potential valuation north of US$1 billion if the option was to be exercised at market multiples.
TT’s front end would be a way to deepen institutional use of its flagship SPX index-options franchise, where retail platforms account for about 90 % of customer flow, according to Bank of America analysts. They add that TT’s connectivity to seventy-plus venues and its futures heritage could accelerate that push.
The exchange is simultaneously litigating with the U.S. SEC after the regulator rejected Cboe’s proposal to exempt exchange-affiliated OEMSs from certain reporting rules. “Cboe is now litigating the matter in the Federal court system,” the BofA note reminds investors.
If the Chicago-based group were to have bought TT, it would have marked its first billion-dollar-plus transaction since the BATS Global Markets takeover in 2017.
Cboe, like CME have seen major growth in volume through retail involvements in markets.
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