Cedel starts new trading service

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LIBERTY, a subsidiary of the Cedel Eurobond settlements network, is launching an electronic equities trading service which for the first time will let investors anywhere in the world deal instantaneously with the 10 main stock exchanges in North America.

The InterTrade Direct service is the first part of a project that next year will also allow millions of US investors to deal direct with any stock exchange in the world. This should ease the flow of outward investment from the US and add liquidity to global markets.

The Liberty system will compete with the London Stock Exchange's own Seaq International dealing service, but the exchange is sanguine about new systems entering the City.

A spokeswoman for the exchange said: 'The London market has room for other players who add value and depth to the liquidity of the market as a whole.'

InterTrade has been tested in six European countries and has signed up a large number of broker dealers, market-makers and investment banks, says Jeff Metter, the London-based general manager of Liberty. It will also allow fund managers to deal directly with US exchanges, with confirmation of trades taking just 30 seconds.

The idea behind InterTrade is to provide a hub around which all kinds of incompatible share dealing systems around the world could operate without modifying their own systems. Costs are negotiated between the customer and the broker- dealer, with Liberty charging the broker a transaction fee.

A separate attempt at improving cross-border compatibility is Nordquote, which connects Scandinavia's five main stock exchanges.

Liberty was set up by Cedel as a distinct operation to seek out new markets.

Cedel was launched in Luxembourg in 1970 as a global clearing house for the multi-billion-dollar Eurobond market.