TradeStation has become the first retail brokerage in the U.S. to get membership approval from the IEX Exchange. The news comes just a couple of weeks before the official launch of the newest exchange which is has gained approval from the Securities and Exchange Commission (SEC) in June.
After TradeStation parted ways with its foreign exchange business earlier this year, the broker-dealer and Futures Commission Merchant (FCM) is now focusing its efforts on delivering best execution to its clients in exchange traded products.
Empowerment, transparency and fairness are the keys to providing the best trading platform
Commenting on the announcement, the President of TradeStation Group, John Bartleman, said: “IEX’s philosophy to give all traders an equal opportunity for best execution is consistent with TradeStation’s steadfast goal to empower our clients with the most effective research and analysis software tools and resources available.”
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“This includes the power to design, back-test, optimize and automate custom trading strategies and ideas across electronic stock, ETF, equity and index option, and commodity and financial futures markets. Empowerment, transparency and fairness are the keys to providing the best trading platform and execution opportunities to self-directed traders,” he elaborated.
‘Flash Boys’ Controversy
The IEX, whose name is an acronym of Investors Exchange, has been widely mentioned as an alternative to markets dominated by high frequency trading in the latest best selling book by Michael Lewis, ‘Flash Boys’. The claims in the book have been widely criticized by companies involved in high-frequency trading.
The IEX is starting a step-by-step rollout of some securities on August 19th and intends to go fully operational on the 2nd of September. In the aftermath of the publication of the book, TradeStation became the first retail brokerage to offer its clients direct market access to the IEX Alternative Trading System (ATS). The brokerage will continue offering the service until the launch of the thirteenth exchange in the U.S.
Commenting on the announcement, Ronan Ryan, President and co-founder of IEX Group, said: “We thank TradeStation for their support of IEX, which is designed to prioritize the interests of real investors. We look forward to providing their clients with a differentiated choice for years to come.”