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Nasdaq (NDAQ) Buys Minority Stake in RegTech Firm Caspian

Zacks Equity Research

Nasdaq, Inc.’s NDAQ investment arm Nasdaq Ventures has purchased a minority stake in Caspian. Also, the Market Technology business of Nasdaq has inked a partnership deal with Caspian to boost business growth in financial crime market vertical. The details of the investment were not made public.

Caspian, a UK-based automated financial crime investigations firm, is the industry leader in automated AML (anti-money laundering) investigation technology. It specializes in automated investigation of high volume, complex AML risk alerts for financial services firms. It is powered by technology, which analyzes alerts and provides fully explained risk judgments in seconds. It is proved to deliver expert quality AML investigations consistently and more efficiently.

Nasdaq made this investment in Caspian in a bid to enhance the transparency of markets and to boost its efforts to fight financial crimes in the financial services industry. Nasdaq intends to boost the regtech ecosystem for banks, regulators and its consumers by leveraging the competence of Caspian in detection, mitigation, fraudulent management and criminal behavior through its technology leadership.

Both Nasdaq and Caspian will also join forces for research and development (R&D) efforts to develop more sophisticated products that will enable financial crime detection.

As far as Caspian is concerned, this partnership with Nasdaq will boost its product expansion, bolster its flagship platform, AML Investigator and provide them the opportunity to expand its offering on a global scale.

Recently, Cboe Global Markets CBOE has agreed to buy MATCHNow, the largest equities alternative trading system in Canada, from Virtu Financial VIRT in its effort to venture into the Canadian market.

Shares of this Zacks Rank #3 (Hold) stock have rallied 23% in the past year, outperforming the industry’s increase of 7.6%. Solid fundamentals should help the stock retain the momentum.


Stock to Consider

A better-ranked stock from the same industry is MarketAxess Holdings MKTX.

MarketAxess operates an electronic trading platform that enables fixed-income market participants to trade corporate bonds and other types of fixed-income instruments worldwide. The company delivered a positive surprise of 3.70% in the last reported quarter. It sports Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

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