Brokerage Knight Capital Group has agreed to acquire agency-only algorithmic broker EdgeTrade for around $59.5 million.
The addition of EdgeTrade will give Knight an algorithmic offering for the buyside and will enable it to cross-sell EdgeTrade’s algorithms to clients through Knight Direct, its direct market access platform.
Knight expects demand for new algorithms that cover international equities and other asset classes such as foreign exchange and options.
Thomas Joyce, chairman and CEO of Knight Capital Group, says: "As algorithmic trading increases in a fragmented market environment, the acquisition of
EdgeTrade will enhance our trade execution services and provides us with a significant advantage as demand continues to grow for sophisticated, next generation algorithms.”
Knight provides electronic and voice trade execution services to more than 2,000 buy- and sell-side firms in international equities, foreign exchange, futures, options and fixed income.
The broker announced plans to enter the European market on the tails of the Markets in Financial Instruments Directive (MiFID), where it will compete with European exchanges and alternative trading venues such as dark pools of liquidity.