Blue Ocean ATS Dominates Overnight Trading, Expects to Maintain Edge for 3-5 Years

BOCA RATON, Fla. (JLN) — Brian Hyndman, the CEO of Blue Ocean Technologies, an alternative trading system (ATS) specializing in overnight trading of U.S. equities catering to a global audience, acknowledged the emergence of potential competitors in the 24-hour trading space for U.S. equities in an interview with John Lothian News at FIA Boca50. However, he said he thought that with the industry not quite ready for full-fledged 24-hour exchange operations, the ATS model would prove superior in the short term.

“The ATS model will remain dominant for the next three to five years,” he said, citing challenges such as real-time trade reporting and handling corporate actions.

Blue Ocean operates during non-traditional hours, trading from 8 p.m. to 4 a.m. ET, filling the gap left by traditional exchanges. “On any given night, we’ll trade over 5,000 different National Market System stocks,” Hyndman explained. This model aligns with the growing demand for 24/5 trading, especially from investors in Asia and Europe who seek access to U.S. equities during their local daytime hours.

“We have roughly 70 brokers trading on the platform,” said Hyndman. “About 75 to 80% of our business comes from Asia Pacific in general.” He noted that while U.S. trading activity often spikes during episodic events, such as major announcements, the majority of Blue Ocean’s volume is driven by international markets.

In order to improve performance given the increased demand for overnight trading, in mid-2024, Blue Ocean transitioned to Members Exchange (MEMX) technology, a move Hyndman described as transformative. “It really has given us exchange-grade quality that our customers demand,” he said. The new system significantly increased capacity and reliability, addressing prior issues that had caused disruptions.

Looking ahead, Hyndman highlighted plans for geographical expansion. “We now have offices and feet on the ground in Tokyo, Seoul, and Europe,” he said. The company aims to deepen its presence in other Asia-Pacific regions over the next 12 to 24 months.

Hyndman expressed doubts about tokenizing equities for 24-hour trading. “I don’t believe that National Market System stocks need to be tokenized to be traded 24 hours a day,” he stated, contrasting equities with cryptocurrencies that lack clearinghouses and operate on different settlement timelines.

Hyndman underscored the increasing significance of overnight trading volumes. “A couple of years ago, pre- and post-market sessions did about 700 million shares; now they do 1.7 billion shares at night,” he said. This growth reflects a shift in how global investors approach risk management and market opportunities outside traditional U.S. trading hours.



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00:00:00 - Introduction and Customer Demographics
00:00:47 - 24-5 Trading at Blue Ocean
00:01:16 - Overnight Trading and Industry Challenges
00:02:02 - Views on Tokenization and Crypto
00:02:30 - Alpha Creation and Trading Volumes
00:03:02 - Transition to Memex Technology
00:03:26 - Future Plans for Blue Ocean