New York, NY, June 25, 2008: NYFIX, Inc. (Nasdaq: NYFX), a trusted provider of innovative solutions that optimize trading efficiency, today announced that research conducted by Quantitative Services Group LLC (QSG®), a leading provider of equity analytics, has confirmed that executions through its alternative trading system, NYFIX Millennium®, exhibit lower cumulative price impact compared to a broad universe of trade execution venues. Specifically, QSG’s research revealed that Millennium reduced market impact costs across a number of market sectors ranging from large-cap to micro-cap stocks. Further, the study showed that stocks characterized by earnings or price momentum, which are typically more difficult to trade on traditional exchanges, saw significantly lower relative cumulative impacts costs when executed through NYFIX Millennium.
Dark pools such as NYFIX Millennium are designed to achieve better executions than those available on traditional exchanges by minimizing information leakage. The QSG research confirms that NYFIX Millennium reduces market impact as compared to other available trading venues, thereby enabling NYFIX clients to optimize their trading strategies and realize best execution.
NYFIX Millennium versus QSG Transaction Universe
Market Category Percentage Decrease in Market Impact Basis Point Per Share Savings
Micro-cap 66% 21.53
Small-cap 63% 13.43
Mid-cap 59% 8.08
Large-cap 62% 5.18
Weighted Average 62% 6.61
Earnings Momentum/Price Momentum 60% 6.77
C. Thomas Richardson, Advisor and incoming Global Head of Transactions Services at NYFIX, commenting on the research, said: "Reducing information leakage, and in turn, market impact, is one of our clients’ key goals. The QSG research demonstrates that NYFIX Millennium helps our clients achieve this goal by reducing trade execution costs while providing a tremendous amount of liquidity across a broad range of NYSE and NASDAQ stocks."
QSG Research Methodology
QSG’s research examines the transaction cost characteristics associated with trades executed in NYFIX Millennium and contrasts them with a diversified execution composite – the QSG Transaction Universe – which represents a broad array of execution venues including traditional exchange executions. Historically, the transaction cost analysis conducted by most buy-side traders (VWAP, TWAP, etc.) is based on an order’s average execution price and the overall price/volume activity in the stock. Believing this analysis does not go far enough to measure a given venue’s market impact, QSG’s patent-pending analysis technique TCost pro™ calculates the cumulative costs associated with trading by evaluating the individual prints that are rolled-up into the larger order. This technique was applied to NYFIX data from December 2007 to March 2008 for which the analyzed execution value is $274 billion from 30 million strikes and over 8 billion shares, with QSG’s resulting research demonstrating that NYFIX Millennium is able to deliver on the goal of reducing equity trading costs, specifically the reduction of market impact costs.
About NYFIX, Inc.
A pioneer in electronic trading solutions, NYFIX continues to transform trading through innovation. The NYFIX Marketplace™ is a global community of trading counterparties utilizing innovative services that optimize the business of trading. NYFIX Millennium® provides the NYFIX Marketplace™ with new methods of accessing liquidity. NYFIX also provides value-added informational and analytical services and powerful tools for measuring execution quality. A trusted business partner to the buy-side and sell-side alike, NYFIX enables ultra low touch, low impact market access and end-to-end transaction processing. For more information, please visit www.nyfix.com.
Caution Regarding Forward Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Actual future events, circumstances, performance and trends could materially differ from those set forth in these statements due to various factors, including but not limited to: general economic conditions; the effects of current, pending and future legislation; regulation and regulatory actions; actions and initiatives by both current and future competitors; our ability to accommodate increased levels of trading activity and keep current with market data requirements; the risks related to the ability of NYFIX to develop and market its products and services; NYFIX’s success in obtaining, retaining and selling additional products and services to clients; the pricing of products and services; stock market activity; the ability of NYFIX’s Transaction Services Division to maintain third-party assistance to access exchanges and other important trading venues; changes in technology; the availability of skilled technical associates; the ability of NYFIX to obtain necessary network equipment, technical support or other telecommunications services or being forced to pay higher prices for such equipment, support or services; and the impact of new acquisitions and divestitures; and other risks and uncertainties including those detailed in our SEC filings; as well as future decisions by us. There can be no assurance that the forward-looking statements will prove to be accurate and the inclusion of such information should not be regarded as a representation by NYFIX or any other person that the objectives and plans of NYFIX will be achieved. In addition, the forward-looking statements included in this press release represent NYFIX’s views as of the date of this press release. NYFIX anticipates that subsequent events and developments will cause NYFIX’s views to change. However, while NYFIX may elect to update these forward-looking statements at some point in the future, NYFIX specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing NYFIX’s views as of any date subsequent to the date of this press release. All trademarks, trade names, logos, and service marks referenced herein belong to NYFIX, Inc.
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Phone: +1 212 754 5479
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