Liquidnet Announces 2011 Performance Highlights

Global Expansion Drives Performance

NEW YORK--(BUSINESS WIRE)--Liquidnet, the global institutional trading network, today announced 2011 performance highlights, monthly and year-to-date trading statistics for US and international equities.

“Liquidnet has established the global network for institutional investors to allow them to access liquidity and execute trades on a completely different scale. In a year of high volatility and increased uncertainty around the future of global markets, Liquidnet created unique investing opportunities and brought on new sources of liquidity. This includes our partnership with the SIX Swiss Stock Exchange and the addition of over 600 corporations to the network who now have the ability to execute buy backs and other at the market transactions through our platform,” said Seth Merrin, Founder and CEO of Liquidnet. “In 2012, Liquidnet is focused on continuing to provide the deepest and most unique pool of liquidity, opening up new investment opportunities around the world and creating an unmatched user experience for institutional investors globally.”

2011 Trading Highlights

In 2011, Liquidnet maintained its block trading dominance in markets around the world. The company continues to lead the industry with an overall average execution size of 48,422 shares in the US, a 3% increase from 2010. Other block highlights include:

• 62% of the time when Liquidnet traded a stock in 2011 it was either the 1^st or 2^nd largest print of the day in that stock. For small cap stocks this percentage rose to over 80%.
• On average in 2011, when Liquidnet traded a stock, it represented 39% of the day’s market block volume in that stock. For small cap stocks that percentage rose to 57%.
• In 2011, Liquidnet also saw a 31% year-over-year increase in volume executed through our trading desk.

Global Performance

Following an aggressive global expansion including the addition of Indonesian equities in 2011, Liquidnet continues to see record performance in markets outside of the US. Liquidnet has connected the world’s leading asset management firms with the liquidity they need to execute large trades and realize investment opportunities around the world. Highlights include:

• Liquidnet Asia-Pacific has connected 200 of the leading asset management firms in the region to Liquidnet’s network. The average execution size in 2011 was US$1.2 million, up approximately 11% from 2010. That is over 116 times the average execution size on the Hong Kong Stock Exchange over the same period. In addition, Liquidnet executed its largest trade ever in the Asia Pac region in Q4 totaling US$59 million in principal traded. Other 2011 milestones include:
  • Average daily liquidity increased over 19% year-over-year to more than US$8.4 billion.
  • Average daily principal traded also increased over 23% year-over-year to more than US $68 million.
  • Year-to-date principal traded in Southeast Asia, including Indonesia, Malaysia, and Singapore, was US$1.6 billion, up 137% from 2010.
• Liquidnet Canada has more than 29 Canadian-based asset management firms and over100 global asset managers now trading Canadian equities through Liquidnet. Liquidnet Canada’s average execution size is more than 150 times greater than on the TSX and 190 times larger on average than other off-exchange trading venues in Canada. In 2011, Liquidnet volumes grew 60% year-over-year and average daily liquidity increased over 49% to 404mm shares/per day year-over-year.
• Liquidnet Europe also continued to maintain block dominance in 2011 with an average execution size of $879,845 - the largest of any other trading venue in the region. In an ongoing effort to bring additional liquidity to institutional investors, Liquidnet and the SIX Swiss Exchange launched the ground breaking trading platform for non-displayed equity block trading. The unique platform allows SIX Swiss Exchange members and buy side market participants to execute large block trades efficiently in Swiss and global equities through Liquidnet’s exclusive global liquidity pool.

John Barker, Managing Director of Liquidnet Europe, said, “We have continued to build a unique global liquidity pool for investors, creating opportunities to trade in sizes that are unrivalled around the world. Our platform with the SIX Swiss Exchange is an opportunity to access the wholesale market and execute large block trades with the global institutional trading community through a safe and secure trading environment.”

Equity Capital Markets/Private Shares Trading

Liquidnet’s Equity Capital Markets (ECM) business also saw strong momentum this year with Liquidnet participating in a number of capital market transactions including share repurchases, IPOs, and other share offerings. The team executed more than $1 billion in transactions in 2011. The company also launched its private shares group, creating investment opportunities for institutional investors and some of the most exciting private companies in the social media space.

Awards and Accolades

Liquidnet received numerous awards from across the globe in 2011, validating its exceptional standard of service and unmatched value of its offerings. Awards include:

• “#1 in Operational Performance” in the US and in Europe; first place rankings in all three major US categories, 2011 McLagan/Z/Yen Survey of Operational Performance of Brokers
• “Best Buy Side Execution Venue,” Buy Side Technology Awards (fourth consecutive year)
• “Best Crossing Network,” Waters Ranking 2011
• “Best Performing Broker Worldwide and in North America,” Ancerno Ltd on behalf of Bloomberg News
• “#1 Broker in the United States,” Elkins/McSherry on behalf of Pensions & Investments
• “Best Crossing Network 2011,” The Asset’s Asian Awards (third consecutive year)
• “Dark Pool of the Year,” The Asset’s Asian Awards (second year)

December Volume

	Current Month^[i]				Year-to-Date^i
	Dec ‘11	Dec ‘10	Change		Dec ‘11	Dec ‘10	Change
Total US trading volume (shares in thousands)^[ii]	691,900	1,019,713	-32	%	12,997,619	12,770,242	2	%
Total US trading days	21	22	-5	%	252	252	0	%
Average daily US trading volume (shares in thousands)	32,948	46,351	-29	%	51,578	50,676	2	%
Average daily US natural liquidity (shares in thousands)	1,494,989	1,657,618	-10	%	1,775,996	1,755,337	1	%
Average US execution size in shares^[iii]	39,417	47,118	-16	%	48,422	47,149	3	%
Total international principal traded ($USD in thousands)	4,336,363	8,568,159	-49	%	101,961,792	97,150,152	5	%
Total foreign exchange adjusted international principal traded ($USD in thousands)^[iv]	4,471,955	8,568,159	-48	%	97,941,245	97,150,152	1	%

About Liquidnet

Liquidnet is the global institutional trading network that connects equity investors with the liquidity they need– in size, at any time, from anywhere. We go beyond what the retail market can provide by defending and securing the integrity and the anonymity of the block trade. We do this while continuously looking for ways to bring in new sources of safe, actionable liquidity from asset management firms, exchanges, brokers and corporations. Since we launched in 2001, our ability to anticipate and meet institutional demand has allowed us to extend trading to 39 equity markets across five continents for asset management firms who collectively manage US$12.4 trillion. For more information on the Liquidnet community, its liquidity, block executions, and additional investment capabilities, visit www.liquidnet.com.

[i] Historical numbers may be subject to revision.
[ii] Consists of shares of US equity securities executed in our negotiation and Liquidnet H2O® ATSs and third party execution venues.
[iii] Negotiation product.
[iv] Amounts adjusted to reflect foreign exchange rates for the same period from 2010.