CBOE partners with UK firm to launch U.S. private share trading platform, Bloomberg News reports

(Reuters) - Derivatives exchange operator CBOE is partnering with a London-based tech firm, Globacap, to create a U.S. trading platform for shares of closely held companies, Bloomberg News reported on Wednesday.

 

CBOE Private Markets has already registered with the Financial Industry Regulatory Authority (FINRA) as a broker-dealer last month, the report said, adding that the platform is currently in its pilot stage, with no official launch date announced. 

 

Private markets have gained popularity as investors seek alternative assets beyond traditional stocks and bonds. High profile startups like SpaceX and OpenAI staying private for longer have also boosted the appeal of such assets.   

 

Some financial heavyweights are capitalizing on this interest. In June, asset management giant BlackRock acquired British tech firm Prequin to expand its footprint in the space, while MSCI launched 130 new private market indexes in July. 

 

Exchange operator Nasdaq also spun out a trading platform for private companies in 2021. 

 

"Private markets offer diversification away from listed markets, and investors have the potential to benefit from ... greater protection from market shocks," Marsh McLennan’s consulting unit Mercer wrote in a report last year.

 

Chicago-based CBOE allows customers to trade in options, futures and other derivatives. It has been refocusing on its core businesses and wound down its cryptocurrency spot trading platform this year, citing a lack of regulatory clarity.

 

CBOE did not immediately respond to Reuters request for comment.  A spokesperson for Globacap confirmed the FINRA had granted it a license but declined to give further details.

 

(Reporting by Jaiveer Singh Shekhawat and Niket Nishant in Bengaluru; Editing by Tasim Zahid)