Business

Editor: Bruce Meng
4 Sep 2008 08:55:36 GMT

SYDNEY, Sept 4 - Share-trading platform AXE ECN, one of three would-be rivals to Australia’s monopoly stock exchange operator ASX Ltd <ASX.AX>, plans to take around 23 percent of trading volumes within 12 months of starting up.

AXE, backed by six major brokerages which claim to handle about 45 percent of existing trading volumes, is applying for an exchange licence which, if granted, would end ASX’s effective trading monopoly over Asia’s fourth-largest share market.

"It all depends on market growth assumptions, but it’s an aspiration, yes," AXE ECN Chief Executive Susan Bray said in an interview on Thursday, referring to the market-share goals. She said AXE aimed to capture about 13 percent of trading volumes in its first phase of operation, by focusing on large wholesale trades, before moving to a more comprehensive trading platform and taking an additional 10 percent market share.

The government is considering licence applications from AXE and two others, Europe’s Chi-X and U.S.-based Liquidnet, to set up rival exchanges to the ASX, which has reigned for 21 years over a market where around $100 billion in shares change hands every month, according to World Federation of Exchanges data.

A decision is expected within weeks.

AXE ECN is a venture between New Zealand exchange operator NZX <NZX.NZ> and six investment banks and brokerages: Citigroup <C.N>, CommSec <CBA.AX>, Goldman Sachs JBWere <GS.N>, Macquarie Bank <MQG.AX>, Merrill Lynch <MER.N> and Credit Suisse <CSGN.VX>.

Chi-X is run by Instinet, a U.S. pioneer in alternative trading technologies and owned by Japan’s Nomura <8604.T>. Liquidnet is a privately owned firm that launched in U.S. share markets in 2001 and has since expanded into Canada and Europe.