Top stories

Leading Turkish Broker Oyak Securities Selects CameronTec’s Catalys

Mar 26, 2015

CameronTec Group, the global standard in financial messaging infrastructure and tools for the Capital Markets industry, today announced leading Turkish Broker, Oyak Securities, has selected the Catalys FIX gateway to connect to Borsa Istanbul’s markets.

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Neonet and SimCorp Provide Algorithmic Trading Capabilities

Mar 25, 2015

Neonet, the independent agency broker and execution specialist, today announced that it has enhanced its integration with SimCorp, the leading provider of investment management software solutions and services for the global financial industry. Through the integration mutual clients leveraging SimCorp’s software solutions get access to Neonet’s full range of execution algorithms.

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SEC Proposes Rule to Require Broker-Dealers Active in Off-Exchange Market to Become Members of National Securities Association

Mar 25, 2015
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Washington D.C., March 25, 2015 — The Securities and Exchange Commission today proposed rule amendments to require that broker-dealers trading in off-exchange venues become members of a national securities association. The amendments would enhance regulatory oversight of active proprietary trading firms, such as high frequency traders.

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Latest Blog Posts

Left in the dark

Christian Voigt, Fidessa

Mar 26, 2015
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Currently, it doesn’t really matter whether dark trades are executed under the reference price waiver (RP), large in scale waiver (LIS) or a negotiated trade waiver (NT). However, under MiFID II, the waiver flavour will make a significant difference. Whilst RP and parts of NT will become subject to the clunky double volume cap, LIS will not, so we may expect to see an increase in block trading. But how does an exchange flag a trade that matches a LIS order with an RP order? Coming up with an appropriate approach is now a pressing issue. ESMA would need to start collecting data to measure for the dark caps as early as January 2016 in order to accumulate 12 months’ worth ahead of the MiFID II go-live date. Even if exchanges and regulators can agree on a process, and collect data ahead of time, will it be publicly available? My concern is that if it is not, then market participants cannot tune their trading strategies ahead of the 3rd January 2017 go-live. There is simply no way of telling how many instruments may be affected and it certainly seems like we may be left in the dark for a while longer.
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From Revolution to Evolution in the Search for Liquidity and Alpha

Greg Ludvik, FlexTrade

Mar 24, 2015
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Smart Order Routing (SOR) has ebbed and flowed as a topic of interest in the financial industry.  Because the functionality has become commonplace in the market, its presence in institutional trading platforms has nearly become an afterthought.  But its necessity is without doubt, especially in light of the exponential growth of electronic trading, proliferation of order types and instructions, and fragmentation of liquidity. Revolution The launch of the first smart order router was a revolution in trading, allowing traders to access liquidity across multiple markets and get size done.  Independent smart order routers addressed intermarket linkages years before regulatory changes made this a requirement.  Early movers in the smart order routing space grew tremendously as a result of their pioneering work.  In this early stage, the existence of the tool alone was a large part of its advantage. Reg NMS With the advent of Reg NMS, smart order routing became a regulatory requirement. Now ubiquitous, smart order routing was no longer a standalone differentiator. Within the brokerage community, focus moved from getting fills to reducing costs. As competition intensified, routing charges reached a low point for aggressive (spread-crossing) institutional flow by employing virtually every method in which a smart router operator could conceive to reduce execution fees. The stage was set for a change in the industry conversation. Evolution Prompted by new ideas and voices about smart order routing techniques, the industry began to critically examine the functioning of smart order routers. Questions were raised about how liquidity was being accessed to deliver results, and consideration given to the means by which dark and lit pools were used and accessed. Smart order routing methodology moved back to the foreground for customers. Whether one agreed or disagreed with the arguments in the discussion – certainly, the issues involved are quite complex and difficult to measure – the critical change for the industry was the added pressure on technology and brokerage providers to explain how their products work and defend their implementation decisions. Choosing the lowest explicit cost method was no longer enough. SOR At a Crossroads Today smart order routing is at a crossroads. Cost remains an important consideration, but the details of performance and how trading results are achieved have been restored to their rightful place as equally important considerations. Brokers have multiple options available to them for smart order routing and need to consider whether the available options fit the broker’s business and customers. FlexTrade finds an increasing number of clients (buy-side and sell-side) interested in controlling their smart routing technology with an eye towards delivering optimized results. Smart order routing is also particularly important in foreign exchange, considering the over-the-counter nature of trading. In FX, choices about connectivity, book building and routing are vital to achieving an optimal trading result. The decision to invest in smart order routing technology requires firms to consider how deeply enmeshed they should become in managing their smart order routing. This includes firms which have decided to rent their technology from third party providers and firms that have made the investment to build it themselves. Relevant questions to ask include: Improved customer results – will customers receive improved trading results with new smart routing technology, as measured through TCA? Lowered execution costs – can the technology reasonably improve (or maintain) the trading expense profile for liquidity taking order flow? Lower operating expenses – can the technology operate efficiently, considering costs for hosting, telecom, development and operations? Revenue risk – for brokers that rent technology – without proprietary technology, will customers continue to perceive the broker as a differentiated counterparty? Return on investment – do the combined answers to these questions result in either improved performance or lowered operating expenses, relative to the cost of the project?   How FlexTrade Can Help - FlexTrade has experience designing and implementing smart order routing technology with clients across asset classes and geographies, and is used extensively in equities, FX and options. Our software and trading experts assist clients with the critical design decisions required for a successful smart routing implementation. We also have expertise with regulatory considerations, including the creation and storage of required reports and snapshots for Reg NMS compliance. FlexTrade provides a mature, high-performance strategy server, which abstracts many of the core implementation issues so that customers can begin focusing on trading decisions early in the design process. The framework is capable of supporting a wide range of algorithmic requirements required for a smart order router and runs using C++ on Linux for the highest possible performance. Infrastructure is another area where FlexTrade has made major investments, operating as close to the market as possible, with a high performance server environment, scalable network, and low-latency connectivity. FlexTrade has a presence in top-tier data centers around the world, with an extensive regional and global telecom backbone, offering the ability to deliver products across geographies and asset classes. FlexTrade, however, believes that insourcing a smart order routing solution is not appropriate for all firms. The customer must have a minimum scale and sophistication to be able to manage the technology and operational issues. For firms capable of managing this technology, FlexTrade can make all the difference towards achieving a high quality result.
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Change is the only constant

Anne Plested, Fidessa

Mar 19, 2015
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The unbundling of payment for research is a top concern for the industry. There seems to be general acceptance that, one way or another, Europe is set on the soft dollar research market becoming a hard dollar one by January 2017. Despite calls for more clarity and the recent publication of the FCA discussion paper on the regime, opinion remains divided as to how the use of CSAs can evolve to survive as a payment mechanism. There’s no denying widespread change is already underway, in roughly the same direction of travel as MiFID II. This got me thinking about the number of other services, besides research, that are impacted by MiFID II. The sheer scale of its implementation means that plans are already well advanced in most firms in an effort to maximise headway based on the information available. One of the current recognised challenges is keeping up with the waves of regulation affecting every aspect of the financial marketplace, but it’s not just the big ticket items for 2017 that need to be managed. As national regulators continue with their own agendas and ESMA marches on with peer reviews amongst National Competent Authorities on supervision – of best execution, for example – firms are having to constantly adapt their ‘business as usual’ whilst also watching the 2017 horizon.
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Interview

Bob Holland discusses the current state of the fixed income trading environment

Mar 25, 2015
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ATMonitor speaks with Bob Holland at the EMEA Trading Conference 2015. Bob is Senior Product Manager, Fixed Income and Derivatives at Linedata and discusses the current state of the fixed income trading environment, what changes we are seeing in the market and how regulation is changing the way clients do business.

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Eze Software Group's Steve Shone discusses the current needs of buy-side asset managers

Mar 20, 2015
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ATMonitor speaks with Steve Shone at the EMEA Trading Conference 2015. Steve comments on the current needs of the buy-side and discusses what motivates asset managers to look at the offerings of Eze Software Group.

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ATMonitor speaks with BT's Alexandra Foster at the EMEA Trading Conference 2015

Mar 19, 2015
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ATMonitor speaks with Alexandra Foster, Global Head of Strategy & Business Development at BT. Talking live from the EMEA Trading Conference, Alex comments on the FIX Trading Community and how changes in regulation are driving the current trading environment.

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Survey

The 2015 Algorithmic Trading Survey

Trading Survey THE TRADE invites you to participate in The Algorithmic Survey for 2015, now in its 8th year running. If you are trading electronically, we would appreciate your input on the use of algorithmic trading services. To express our thanks, all participants are eligible for a free one-month online subscription to thetradenews.com. Please rate your algos by completing the online questionnaire available here..

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Research

Shifting sands – the harsh realities of executing in today’s markets

Fidessa

Mar 09, 2015
Shifting sands – the harsh realities of executing in today’s markets

Fidessa has released a new paper entitled Shifting sands – the harsh realities of executing in today’s markets. Authored by Will Winzor-Saile, Electronic Execution Product Specialist at Fidessa, the paper explores how the electronic execution landscape has evolved over the last 10 years and reveals the challenges that now exist for brokers wanting to trade across global markets. Winzor-Saile comments: "Execution infrastructure is increasingly seen as a commodity, but as market complexity and regulation continue to impose themselves, many firms are finding it harder to maintain their competitive differential across the patchwork of electronic trading infrastructures that they've previously relied upon."

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Video showcase

Corvil working with RSJ

Corvil Watch Michal Sanak, CIO, RSJ Algorithmic Trading discuss working with Corvil. read more

Corvil working with Tradition

Corvil Watch Yann L'Huillier, CIO, Tradition and Alex Krovina, CTO, Tradition discuss working with Corvil. read more

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