Dark pools grapple with IOIs

Sending out indications of interest to the market in the dark pool industry has been an issue for a while now. On one level, such indications seem to violate the notion of "dark" trading. The more light you add to what's on the service's book, the more you undercut the premise of such trading. Traders magazine picks up on this and reports that Goldman Sachs and Morgan Stanley promise they will not send out information about their books in their main dark pool services. But they are increasingly swimming against the tide. A host of other players, perhaps not as large, have embraced 'indications of interest' as a service. And why not? Many the more than 40 dark pools sorely need liquidity and IOI are a way of marketing what they've got, so to speak. Some firms allow customers to dictate whether they want at IOI sent to the market. Morgan Stanley acknowledges the issue. It has created a separate pool for those who want to broadcast IOI, the article notes.  

For more:
- here's the Traders article