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BATS Global Markets

January 01, 1970

BATS Global Markets is a global stock exchange operator founded in Lenexa, Kansas, with additional offices in London, New York, Chicago, and Singapore. BATS was founded in June 2005, became an operator of a licensed U.S. stock exchange in 2008 and opened its pan-European stock market in October 2008. As of February 2016, it operated four U.S. stock exchanges, two U.S. equity options exchanges, the pan-European stock market, and a global market for the trading of foreign exchange products. BATS was acquired by Cboe Global Markets in 2017.[3]

BATS Global Markets, Inc
TypeStock exchange
LocationLenexa, Kansas, United States
FoundedJune 2005
OwnerCboe Global Markets
Key peoplePresident and CEO: Chris Concannon;[1][2]
Chairman: Paul Atkins[1]
CurrencyUnited States dollar
Volume1B shares (Jan 2009)
IndicesBATS (withdrawn)
Websitewww.bats.com

The name 'BATS' was originally an acronym for "Better Alternative Trading System".[4]

History edit

The company was founded in June 2005 by Dave Cummings, a computer programmer. Cummings said he was inspired to start the company after observing Archipelago Holdings be acquired by the New York Stock Exchange and Instinet be acquired by NASDAQ within a week of each other in 2005. After the launch of BATS, other brokerage firms, hedge funds, and other clients became involved with the company. Cummings publicized the BATS service by sending emails to companies highlighting the niche that could be carved out by trading on platforms other than the big two—NASDAQ and NYSE.[5] The niche that he sought for the company was for it to be "a neutral, private, broker-dealer owned, semi-profitable utility" with no party owning more than 20 percent.[6] He noted that the consolidation of the New York Stock Exchange and NASDAQ eliminated competition and they raised prices for their services. BATS intended to charge less.[7] Among the plans it had to draw customers was to offer free listings to companies with shares that traded a certain amount each day.[8]

Cummings stepped down in 2007 and was replaced by Joe Ratterman who had been associated with the company from the start. Cummings said in his resignation, "As BATS prepares to become an exchange, my ownership of a broker-dealer precludes me from serving in management". Cummings returned to his position as CEO at Tradebot.[6][9]

European expansion edit

Under the leadership of Ratterman, in March 2008, BATS entered the European equities markets by establishing a multilateral trading facility (MTF) to compete on a pan-European basis against the incumbent securities exchanges. BATS Europe was formally launched in October 2008.[10][11]

In February 2011, BATS Global Markets agreed to buy Chi-X Europe, a competitor and largest pan-European MTF at the time, for $300 million. The deal was referred by the Office of Fair Trading to the Competition Commission in June 2011 for further investigation to "determine whether a substantial lessening of competition is probable as a result of the anticipated merger". However, the Competition Commission approved the transaction in late November 2011, leading to BATS closing the deal on 30 November 2011. In April 2011, BATS Global Markets confirmed that Mark Hemsley, CEO of BATS Europe, would be appointed CEO of the combined entity following BATS's acquisition of Chi-X Europe. By April 2012 the technology integration between the two platforms was complete and Chi-X Europe customers were migrated onto the BATS Europe platform.[12][13][14][15][16]

Initial public offering edit

Also under the leadership of Ratterman, the company attempted to go public on March 23, 2012, as the first listing on its own exchange, but later withdrew the IPO the same day due to a disastrous glitch in the company's trading systems. The glitch resulted in BATS's stock price falling from the original $16 offering price to as low as $0.04 a share. Three erroneous Apple trades on the BATS exchange triggered a circuit breaker which temporarily halted trading in that stock. Those trades were later canceled. BATS halted stocks on its exchange that were affected by the glitch and included stocks with ticker symbols beginning with letters A to BFZZZ. It later reopened trading in the affected symbols but decided to withdraw the BATS stock offering.[17][18][19]

Following the failed IPO, the BATS board of directors decided to separate the roles of chairman and CEO. Ratterman had previously held both roles but received the "unanimous support" of the directors to retain the positions of CEO and president.[20] In July 2012, BATS named Paul Atkins, a former U.S. Securities and Exchange commissioner, to the role of non-executive chairman of its board of directors.[21]

System issue edit

In January 2013, BATS admitted that what it called a "system issue" had generated problems with more than 400,000 trades, going back as far as 2008. Specifically, it admitted that prices had been executed that were "equal to or less than the so-called national best bid and offer price", in violation of Reg NMS.[22]

Merger with Direct Edge edit

In August 2013, BATS and Direct Edge agreed to merge.[23]

Acquisition by CBOE edit

In September 2016, it was announced that BATS was to be acquired in early 2017 by CBOE Holdings, which would pay about $3.2 billion for it.[24] The transaction closed on March 1, 2017.[25]

Operations edit

United States edit

In the United States BATS operated two stock exchanges, the BZX Exchange and the BYX Exchange (The BATS Exchanges), which in 2012 accounted for about 10-12% of all U.S. equity trading on a daily basis.[26][27] BZX and BYX are different chiefly because of their pricing structure and the BZX is almost four times bigger than the BYX.[28] At that time, BATS was the third largest stock exchange operator in the United States.[29]

In November 2008, BATS converted its ECN to a national securities exchange, BZX, which allowed BATS to participate in and earn market data fees from the United States consolidated tape plans, reduce its clearing costs, and operate a primary listings business. In February 2010, BATS expanded into a new asset class by offering trading of listed equity options on BZX. In October 2010, BATS launched BYX, a second national securities exchange for trading listed cash equity securities. BATS launched a primary listings business in the United States on its BZX Exchange in December 2010 and launched its first listings of seven ETFs in January 2012.[10]

With BYX, BATS offered a different pricing model than its larger market, BZX.[30]

Europe edit

BATS entered the European equities markets in 2008, with the launch of BATS Europe, a pan-European multilateral trading facility (MTF).[11] In 2011 it acquired Chi-X Europe, a competitor and largest pan-European MTF at the time, this was merged with BATS Europe.[16]

Notable officers edit

Eric Swanson was Senior Vice President, General Counsel, and Secretary. He joined as General Counsel in January 2008.[31]

In 2014, company president William O'Brien disputed assertions in the book Flash Boys: A Wall Street Revolt. He was quoted in The New York Times as saying about the book's author, "Michael Lewis clearly has a blind side, as we've just discovered". O'Brien was "referring to a previous work by the journalist", the paper reported.[32] O'Brien and Lewis engaged in a "heated debate" on a live CNBC broadcast relating to high-frequency trading,[33] in the first days of the book's release and after an appearance by Lewis on 60 Minutes.[34]

Six months after the company's merger with Direct Edge, O'Brien stepped down as president of the company, and was replaced by CEO Joe Ratterman, who resumed the position of dual CEO/president (a position he previously held from June 2007 through January 2014).[35]

See also edit

References edit

  1. ^ a b Tom Steinert-Threlkeld (17 July 2012). "Bats Names Former SEC Commissioner as Chairman". Securitiestechnologymonitor.com. Retrieved 29 August 2012.
  2. ^ Management, batstrading.com. Retrieved 2014-04-01.
  3. ^ "Cboe U.S. Equities Exchanges Overview". www.cboe.com. Retrieved 15 January 2023.
  4. ^ BATS. . bats.com. Archived from the original on 20 September 2013. Retrieved 6 January 2021.
  5. ^ "Bats Trading CEO Cummings likes being the catalyst - Kansas City Business Journal". Bizjournals.com. Retrieved 27 March 2012.
  6. ^ a b Massaro, Kerry (29 June 2007). . Advanced Trading. Archived from the original on 3 February 2010. Retrieved 27 March 2012.
  7. ^ Grant, Justin. . Advanced Trading. Archived from the original on 30 December 2011. Retrieved 19 February 2016.
  8. ^ "Bats founder says exchange should renew IPO in 2Q". CBS News. Retrieved 27 March 2012.[dead link]
  9. ^ Spicer, Jonathan. . News.yahoo.com. Archived from the original on 27 March 2012. Retrieved 27 March 2012.
  10. ^ a b "Amendment #5 to S-1". Sec.gov. Retrieved 6 September 2012.
  11. ^ a b "US trading system Bats to open European platform". Reuters. 31 March 2008. Retrieved 6 September 2012.
  12. ^ "Bats wins final approval to buy Chi-X Europe". Efinancialnews.com. Retrieved 6 September 2012.
  13. ^ "Bats Tries to Reboot Its IPO". Institutional Investor. 9 May 2012. Retrieved 6 September 2012.
  14. ^ Jeffs, Luke (12 April 2011). "Bats Europe CEO to run Bats Chi-X, Haynes departs". Reuters. Retrieved 6 September 2012.
  15. ^ Schmerken, Ivy (1 May 2012). . Wallstreetandtech.com. Archived from the original on 10 May 2012. Retrieved 6 September 2012.
  16. ^ a b Jeffs, Luke (20 October 2011). "Bats wins regulatory support to buy Chi-X Europe". Reuters. Retrieved 6 September 2012.
  17. ^ Olivia Oran; Jonathan Spicer; Chuck Mikolajczak; Carrick Mollenkamp (23 March 2012). "Bats exchange withdraws IPO after stumbles". Reuters. Retrieved 24 March 2012.
  18. ^ Bremner, Brian (23 March 2012). . Bloomberg Businessweek. Archived from the original on 24 March 2012. Retrieved 24 March 2012.
  19. ^ Rooney, Ben (23 March 2012). "Bats Global Market shares are halted after IPO - Bats: Well, this is awkward". CNN. CNNMoney.com. Retrieved 24 March 2012.
  20. ^ Mehta, Nina. "Bats CEO Cedes Chairman Role as Board Said to Delay IPO". Bloomberg. Retrieved 6 September 2012.
  21. ^ "Bats appoints ex-SEC commissioner as non-executive chairman". Reuters. 17 July 2012. Retrieved 6 September 2012.
  22. ^ Schmerken, Ivy (10 January 2013). . Advanced Trading. Archived from the original on 16 January 2013. Retrieved 15 January 2013.
  23. ^ "BATS and Direct Edge to Merge, Taking on Older Rivals". 26 August 2013.
  24. ^ "CBOE Will Acquire BATS Global Markets for $3.2 Billion". fortune.com. 26 September 2016. Retrieved 27 September 2016.
  25. ^ "CBOE Holdings Announces Close of Acquisition of Bats Global Markets". cboe.com. 1 March 2017. Retrieved 20 April 2017.
  26. ^ "Bats Global Markets". Bats Global Markets. 3 July 2012. Retrieved 29 August 2012.
  27. ^ "Bats Chi-X Europe". Batstrading.co.uk. Retrieved 29 August 2012.
  28. ^ "Bats Exchange". Batstrading.com. Retrieved 14 August 2012.
  29. ^ McLaughlin, Tim (23 March 2012). "Bats' core business solid, future growth uncertain". Reuters. Retrieved 27 March 2012.
  30. ^ Peter Chapman & James Ramage (24 November 2010). "Exchanges Sharpen Their Offerings". Tradersmagazine.com. Retrieved 6 September 2012.
  31. ^ "Bats Exchange | Management Team". Bats Trading. 11 September 2001. Retrieved 15 February 2013.
  32. ^ Merced, Michael de la, and William Alden, "Scrutiny for Wall Street’s Warp Speed", New York Times, March 31, 2014. Retrieved 2014-04-01.
  33. ^ Patel, Sital S., "‘Epic’ debate on high-frequency trading between Michael Lewis, Brad Katsuyama and William O’Brien", MarketWatch, April 1, 2014. Link to CNBC "Katsuyama vs. O'Brien - who won the fight?". Retrieved 2014-04-01.
  34. ^ Sorkin, Andrew Ross, "Fault Runs Deep in Ultrafast Trading", New York Times, March 31, 2014. With link to CBS program (run on 3/30/14) embedded. Retrieved 2014-04-01.
  35. ^ "UPDATE 1-Bats says President William O'Brien leaves company". Reuters. 22 July 2014. Retrieved 29 June 2015.

External links edit

  • Official website

January 01, 1970
bats, global, markets, global, stock, exchange, operator, founded, lenexa, kansas, with, additional, offices, london, york, chicago, singapore, bats, founded, june, 2005, became, operator, licensed, stock, exchange, 2008, opened, european, stock, market, octob. BATS Global Markets is a global stock exchange operator founded in Lenexa Kansas with additional offices in London New York Chicago and Singapore BATS was founded in June 2005 became an operator of a licensed U S stock exchange in 2008 and opened its pan European stock market in October 2008 As of February 2016 it operated four U S stock exchanges two U S equity options exchanges the pan European stock market and a global market for the trading of foreign exchange products BATS was acquired by Cboe Global Markets in 2017 3 BATS Global Markets IncTypeStock exchangeLocationLenexa Kansas United StatesFoundedJune 2005OwnerCboe Global MarketsKey peoplePresident and CEO Chris Concannon 1 2 Chairman Paul Atkins 1 CurrencyUnited States dollarVolume1B shares Jan 2009 IndicesBATS withdrawn Websitewww wbr bats wbr com The name BATS was originally an acronym for Better Alternative Trading System 4 Contents 1 History 1 1 European expansion 1 2 Initial public offering 1 3 System issue 1 4 Merger with Direct Edge 1 5 Acquisition by CBOE 2 Operations 2 1 United States 2 2 Europe 3 Notable officers 4 See also 5 References 6 External linksHistory editThe company was founded in June 2005 by Dave Cummings a computer programmer Cummings said he was inspired to start the company after observing Archipelago Holdings be acquired by the New York Stock Exchange and Instinet be acquired by NASDAQ within a week of each other in 2005 After the launch of BATS other brokerage firms hedge funds and other clients became involved with the company Cummings publicized the BATS service by sending emails to companies highlighting the niche that could be carved out by trading on platforms other than the big two NASDAQ and NYSE 5 The niche that he sought for the company was for it to be a neutral private broker dealer owned semi profitable utility with no party owning more than 20 percent 6 He noted that the consolidation of the New York Stock Exchange and NASDAQ eliminated competition and they raised prices for their services BATS intended to charge less 7 Among the plans it had to draw customers was to offer free listings to companies with shares that traded a certain amount each day 8 Cummings stepped down in 2007 and was replaced by Joe Ratterman who had been associated with the company from the start Cummings said in his resignation As BATS prepares to become an exchange my ownership of a broker dealer precludes me from serving in management Cummings returned to his position as CEO at Tradebot 6 9 European expansion edit Under the leadership of Ratterman in March 2008 BATS entered the European equities markets by establishing a multilateral trading facility MTF to compete on a pan European basis against the incumbent securities exchanges BATS Europe was formally launched in October 2008 10 11 In February 2011 BATS Global Markets agreed to buy Chi X Europe a competitor and largest pan European MTF at the time for 300 million The deal was referred by the Office of Fair Trading to the Competition Commission in June 2011 for further investigation to determine whether a substantial lessening of competition is probable as a result of the anticipated merger However the Competition Commission approved the transaction in late November 2011 leading to BATS closing the deal on 30 November 2011 In April 2011 BATS Global Markets confirmed that Mark Hemsley CEO of BATS Europe would be appointed CEO of the combined entity following BATS s acquisition of Chi X Europe By April 2012 the technology integration between the two platforms was complete and Chi X Europe customers were migrated onto the BATS Europe platform 12 13 14 15 16 Initial public offering edit Also under the leadership of Ratterman the company attempted to go public on March 23 2012 as the first listing on its own exchange but later withdrew the IPO the same day due to a disastrous glitch in the company s trading systems The glitch resulted in BATS s stock price falling from the original 16 offering price to as low as 0 04 a share Three erroneous Apple trades on the BATS exchange triggered a circuit breaker which temporarily halted trading in that stock Those trades were later canceled BATS halted stocks on its exchange that were affected by the glitch and included stocks with ticker symbols beginning with letters A to BFZZZ It later reopened trading in the affected symbols but decided to withdraw the BATS stock offering 17 18 19 Following the failed IPO the BATS board of directors decided to separate the roles of chairman and CEO Ratterman had previously held both roles but received the unanimous support of the directors to retain the positions of CEO and president 20 In July 2012 BATS named Paul Atkins a former U S Securities and Exchange commissioner to the role of non executive chairman of its board of directors 21 System issue edit In January 2013 BATS admitted that what it called a system issue had generated problems with more than 400 000 trades going back as far as 2008 Specifically it admitted that prices had been executed that were equal to or less than the so called national best bid and offer price in violation of Reg NMS 22 Merger with Direct Edge edit In August 2013 BATS and Direct Edge agreed to merge 23 Acquisition by CBOE edit In September 2016 it was announced that BATS was to be acquired in early 2017 by CBOE Holdings which would pay about 3 2 billion for it 24 The transaction closed on March 1 2017 25 Operations editUnited States edit In the United States BATS operated two stock exchanges the BZX Exchange and the BYX Exchange The BATS Exchanges which in 2012 accounted for about 10 12 of all U S equity trading on a daily basis 26 27 BZX and BYX are different chiefly because of their pricing structure and the BZX is almost four times bigger than the BYX 28 At that time BATS was the third largest stock exchange operator in the United States 29 In November 2008 BATS converted its ECN to a national securities exchange BZX which allowed BATS to participate in and earn market data fees from the United States consolidated tape plans reduce its clearing costs and operate a primary listings business In February 2010 BATS expanded into a new asset class by offering trading of listed equity options on BZX In October 2010 BATS launched BYX a second national securities exchange for trading listed cash equity securities BATS launched a primary listings business in the United States on its BZX Exchange in December 2010 and launched its first listings of seven ETFs in January 2012 10 With BYX BATS offered a different pricing model than its larger market BZX 30 Europe edit BATS entered the European equities markets in 2008 with the launch of BATS Europe a pan European multilateral trading facility MTF 11 In 2011 it acquired Chi X Europe a competitor and largest pan European MTF at the time this was merged with BATS Europe 16 Notable officers editEric Swanson was Senior Vice President General Counsel and Secretary He joined as General Counsel in January 2008 31 In 2014 company president William O Brien disputed assertions in the book Flash Boys A Wall Street Revolt He was quoted in The New York Times as saying about the book s author Michael Lewis clearly has a blind side as we ve just discovered O Brien was referring to a previous work by the journalist the paper reported 32 O Brien and Lewis engaged in a heated debate on a live CNBC broadcast relating to high frequency trading 33 in the first days of the book s release and after an appearance by Lewis on 60 Minutes 34 Six months after the company s merger with Direct Edge O Brien stepped down as president of the company and was replaced by CEO Joe Ratterman who resumed the position of dual CEO president a position he previously held from June 2007 through January 2014 35 See also editDirect Edge List of stock exchanges List of stock exchanges in the Americas List of stock exchange mergers in the AmericasReferences edit a b Tom Steinert Threlkeld 17 July 2012 Bats Names Former SEC Commissioner as Chairman Securitiestechnologymonitor com Retrieved 29 August 2012 Management batstrading com Retrieved 2014 04 01 Cboe U S Equities Exchanges Overview www cboe com Retrieved 15 January 2023 BATS BATS FAQs bats com Archived from the original on 20 September 2013 Retrieved 6 January 2021 Bats Trading CEO Cummings likes being the catalyst Kansas City Business Journal Bizjournals com Retrieved 27 March 2012 a b Massaro Kerry 29 June 2007 Dave Cummings Steps Down As Bats CEO Prez Advanced Trading Archived from the original on 3 February 2010 Retrieved 27 March 2012 Grant Justin Dave Cummings Market Maker Advanced Trading Archived from the original on 30 December 2011 Retrieved 19 February 2016 Bats founder says exchange should renew IPO in 2Q CBS News Retrieved 27 March 2012 dead link Spicer Jonathan Bats founder pushes for IPO despite freak glitch Yahoo News News yahoo com Archived from the original on 27 March 2012 Retrieved 27 March 2012 a b Amendment 5 to S 1 Sec gov Retrieved 6 September 2012 a b US trading system Bats to open European platform Reuters 31 March 2008 Retrieved 6 September 2012 Bats wins final approval to buy Chi X Europe Efinancialnews com Retrieved 6 September 2012 Bats Tries to Reboot Its IPO Institutional Investor 9 May 2012 Retrieved 6 September 2012 Jeffs Luke 12 April 2011 Bats Europe CEO to run Bats Chi X Haynes departs Reuters Retrieved 6 September 2012 Schmerken Ivy 1 May 2012 Bats Europe Completes Tech Migration of Chi Ex Wall Street amp Technology Wallstreetandtech com Archived from the original on 10 May 2012 Retrieved 6 September 2012 a b Jeffs Luke 20 October 2011 Bats wins regulatory support to buy Chi X Europe Reuters Retrieved 6 September 2012 Olivia Oran Jonathan Spicer Chuck Mikolajczak Carrick Mollenkamp 23 March 2012 Bats exchange withdraws IPO after stumbles Reuters Retrieved 24 March 2012 Bremner Brian 23 March 2012 The Bats Affair When Machines Humiliate Their Masters Bloomberg Businessweek Archived from the original on 24 March 2012 Retrieved 24 March 2012 Rooney Ben 23 March 2012 Bats Global Market shares are halted after IPO Bats Well this is awkward CNN CNNMoney com Retrieved 24 March 2012 Mehta Nina Bats CEO Cedes Chairman Role as Board Said to Delay IPO Bloomberg Retrieved 6 September 2012 Bats appoints ex SEC commissioner as non executive chairman Reuters 17 July 2012 Retrieved 6 September 2012 Schmerken Ivy 10 January 2013 Another Technical Issue From Bats Rattles Confidence Advanced Trading Archived from the original on 16 January 2013 Retrieved 15 January 2013 BATS and Direct Edge to Merge Taking on Older Rivals 26 August 2013 CBOE Will Acquire BATS Global Markets for 3 2 Billion fortune com 26 September 2016 Retrieved 27 September 2016 CBOE Holdings Announces Close of Acquisition of Bats Global Markets cboe com 1 March 2017 Retrieved 20 April 2017 Bats Global Markets Bats Global Markets 3 July 2012 Retrieved 29 August 2012 Bats Chi X Europe Batstrading co uk Retrieved 29 August 2012 Bats Exchange Batstrading com Retrieved 14 August 2012 McLaughlin Tim 23 March 2012 Bats core business solid future growth uncertain Reuters Retrieved 27 March 2012 Peter Chapman amp James Ramage 24 November 2010 Exchanges Sharpen Their Offerings Tradersmagazine com Retrieved 6 September 2012 Bats Exchange Management Team Bats Trading 11 September 2001 Retrieved 15 February 2013 Merced Michael de la and William Alden Scrutiny for Wall Street s Warp Speed New York Times March 31 2014 Retrieved 2014 04 01 Patel Sital S Epic debate on high frequency trading between Michael Lewis Brad Katsuyama and William O Brien MarketWatch April 1 2014 Link to CNBC Katsuyama vs O Brien who won the fight Retrieved 2014 04 01 Sorkin Andrew Ross Fault Runs Deep in Ultrafast Trading New York Times March 31 2014 With link to CBS program run on 3 30 14 embedded Retrieved 2014 04 01 UPDATE 1 Bats says President William O Brien leaves company Reuters 22 July 2014 Retrieved 29 June 2015 External links editOfficial website Retrieved from https en wikipedia org w index php title BATS Global Markets amp oldid 1224723168, wikipedia, wiki, book, books, library,

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