ASX 0.26% $85.45 asx limited

campaign for broker identification

  1. 400 Posts.
    This is a reply I got from the ASX to my question of why individuals can't have access to broker numbers. As you will see the answers are pathetic and do not mention the real reason, which is that access to broker numbers makes trading easier and more profitable and therefore brokers want to keep it to themselves. If you have access to broker numbers you can see if a particular broker is an ongoing buyer or seller and therefore have a feel as to where the shareprice is going.

    I spoke to the ASX and they said that the disclosure of broker numbers would be something they would consider if they felt there was enough public interest. Perhaps if everyone on HC emailed the guy below the ASX may look into it.

    It would only take a minute to e-mail him and it may make trading for all of us easier.

    Dear Jon,
    Further to your request to my colleague Craig Walker please find
    > the following information that may assist in your understanding of why
    > broker codes are not disclosed outside of broking firms.
    > The broker number associated with a particular trade is confidential
    > to that broker and by agreement of all brokers is to be made available to
    > brokers only through relevant market access agreements.
    > Other reasons for not disclosing broker codes include:
    > * The display of broker numbers to brokers is essential to the
    > efficacy of the trading system. Where a mistake has been made and there
    > is a need for agreement a correction can be made.
    > *
    > * The restriction of broker numbers to brokers ensures efficiency of
    > the market. If broker numbers were generally available to investors, they
    > would contact the bidding or offering broker direct so that the incidence
    > of cross-transactions would increase. This would reduce the flow of
    > orders to the public auction and the flow of differing opinions upon which
    > the pricing mechanism depends.
    > *
    > * The structure of the market becomes important in relation to the
    > question of disclosure of broker identification numbers to non broker
    > participants who are not bound by the ASX dealing rules. One of the
    > features of an order driven market is the importance of exposure of
    > trading interest to the central auction process. It is considered that
    > such consolidation of trading interest is important to liquidity of the
    > market and provides benefits to traders and investors generally.
    > *
    > * The provision of that information to non brokers who do not have the
    > same obligations to the central market and where counter party risk is not
    > a factor in transaction decisions may not lead to greater market
    > efficiency. Greater market efficiency will not occur if the information
    > leads to transactions undertaken as specials with selected brokers or
    > completely off market by private treaty. In both cases a reduction of
    > liquidity of the central market would result.
    > I trust this information answers your query.
    > Regards
    Jonathan Morgan
    Manager, Customer Service
    Australian Stock Exchange Limited
    Exchange Centre
    Level 7, 20 Bridge Street
    Sydney NSW 2000
    Phone: 1300 300 279
    Fax: (61 2) 9227 0885
    e-mail: [email protected]

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