The CHART OF THE DAY compares the volume of Olympus Corp. shares traded on alternative venues with the number transacted via the TSE over the last month. Off-exchange venues, which normally process about 7.8 percent of Japanese equity trades, handled 6.5 million shares of Olympus on Nov. 10, when the weight of orders to sell forced the Tokyo bourse to cancel its opening auction. That’s almost four times the number that changed hands via the TSE that day, according to data compiled by Bloomberg.

“It was a very good thing for the alternative trading systems in the Japanese market,” said Simmy Grewal, a London- based market structure analyst at Aite Group LLC, in an e-mail Dec. 7. “A lot of firms hadn’t looked at them before, especially domestic firms. They had no need to look at them as the majority of liquidity was on the TSE. But a scenario like this, where people want to get out of the stock and can’t exit through the main exchange, makes them think about things differently.”

Olympus admitted to hiding about $1.5 billion in losses and has been placed on two watchlists for delisting by the TSE. No trades were executed via the main Tokyo bourse until 3 p.m. on Nov. 10 after a rule was triggered that prevents any transactions when supply and demand won’t match. The stock is down 53 percent since the scandal began on Oct. 13.

Alternative venues such as SBI Japannext Co. and Nomura Holdings Inc.’s Chi X Japan handled about 7.8 percent of total daily share-trading volume in Japan during the last year, up from less than 1 percent five years ago, according to data compiled by Bloomberg.

“The Olympus case could change the way domestic investors see the alternative venues,” said Kenichi Kubo, senior fund manager at Tokio Marine Asset Management Co. who helps oversee 5.4 trillion yen ($69 billion) in Tokyo. “Previously, we saw those venues as just providing off-regular-hours trading services, but now we can regard them as something to provide additional chances for trading.”

To contact the reporter on this story: Eleni Himaras in Hong Kong at ehimaras@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

http://www.bloomberg.com/news/2011-12-08/olympus-trade-shows-role-for-alternate-venues-chart-of-the-day.html

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