A New Approach to the Regulation of Trading Across Securities Markets

Trading the same security in more than one market, commonly known as multimarket trading, is becoming an increasingly widespread phenomenon both across and within countries. For example, the London Stock Exchange, the third largest stock market in the world, launched in January 1996 a plan for “new electronic trading services” implementing an advanced computer-based trading system. This trading system, which will be accessible from anywhere around the globe, will quote prices to buy and sell securities and automatically executive orders at the quoted prices. The London Stock Exchange intends to introduce similar services in the future to European and Asian markets. This will greatly expand the already prevalent practice of trading stocks that were listed in Continental Europe and the United State in London.