Nasdaq announced the expansion of their auction trading model, targeting less liquid shares, to the Nasdaq Copenhagen First North Growth Market aligning all Nasdaq´s Nordic markets with the same model. This initiative aims to further enhance market integrity and investor protection, effective July 2025.
The new model, initially launched for Nasdaq First North Growth Markets in Sweden and Finland in 2024, is designed to improve orderly price formation for stocks with low liquidity. This reduces both risk and trading costs for investors while strengthening investor protection.
Companies with more than seven percent average spread for two consecutive quarters will have with two options. The first option is to hire a liquidity provider and the second option is to offer trading through an auction model with five auctions per day: opening auction, 11.00, 13.00, 15.00 and closing auction.
“Engaging a liquidity provider is an investment that benefits both investors and the company,” says Nikolaj Kosakewitsch, Head of European Equities & Derivatives at Nasdaq. Investors are protected from high spreads making it easier to enter and exit positions and reduces the risk and cost of trade. In our research, we also see that the stock price response on average is positive and the fact that improved liquidity also improves possibilities to access new capital”
Liquidity across Nasdaq’s Nordic markets has generally improved over the years. However, some companies continue to face liquidity challenges. When spreads widen excessively, even small orders can cause significant price fluctuations. Such volatility can be particularly harmful to retail investors and undermine overall confidence in market integrity.
“For almost 20 years, Nasdaq First North Growth Market has served as an important growth platform, enabling Nordic and international entrepreneurs to access growth capital to develop and expand their businesses. We have seen positive results since the launch of the auction model in Sweden and Finland and we are hopeful that the new trading model will improve price formation and trading experience of the less liquid shares, as well as further enhance quality and integrity of our Danish markets as well”, says Adam Kostyál Head of European Listings at Nasdaq
The First North Growth Market Rulebook for Issuers of Shares will be updated during the bi-annual change on July 1, 2025 and additional information on the new auction segment will be set out in the Nasdaq Nordic INET Market Model effective in due time and trading in the new auction segment will start on July 17, 2025.
Based on data analyzed in 3rd quarter and 4th quarter of 2024, eight firms listed on Nasdaq First North Growth Market Copenhagen are affected by the changes. This is subject to change as Q1 and Q2 data from 2025 will determine which companies that are affected by the change.
Source: Nasdaq
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