Latest Blog Posts

Please lock the door behind you

Christian Voigt, Fidessa

Jul 25, 2014
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Under MiFID II European regulators introduce new rules around algorithmic trading. Whether it’s algo IDs, enhanced audit trails or business clock synchronisation, none of these items would have been on the agenda if it were not for the rapid innovation in information technology over the past decade. Now ESMA is extending its reach into cyberspace, discussing issues such as cyber security monitoring for unwarranted access, system or data interference, communication interception or two-factor authentication. read more

Money Market Funds – what cost safety?

Matt Grinnell, Fidessa

Jul 22, 2014
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Tomorrow the SEC’s five member Commission is expected to vote on new changes to rules for money market funds (MMFs), but will the changes be safer or costlier? The two main changes will see ‘prime’ funds move to a floating NAV and boards permitted to impose redemption fees or even suspend redemptions on a temporary basis. This is all designed to make MMFs less susceptible to runs that could harm investors, but it has not been universally well-received by the Investment Company Institute (ICI), by large fund complexes or by a group of 20 United States senators. read more

ATS TRANSPARENCY: RAISING THE STANDARD

Gary Stone, Bloomberg Tradebook

Jul 18, 2014
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All Alternative Trading Systems (ATSs) are required to file a Form ATS with the U.S. Securities and Exchange Commission (“SEC”) to describe how their system operates. The Form ATS is typically kept confidential between the SEC and the brokerage firm operating the ATS. In recent weeks, many U.S. equity securities trading ATSs have started to make their Form ATS available to the public. In many cases, the Form ATS simply describes the operation of the matching engine. We want to raise the standard of transparency. read more

Hang on a second!

Anne Plested, Fidessa

Jul 17, 2014
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MiFID II introduces the requirement to synchronise the business clocks of trading venues and their customers, standardising the recorded time on post-trade data, transaction reporting and, most importantly, order event auditing. Regulators argue that in the event of unusual market activity they will be able to pinpoint the exact moment things turned sour. A noble cause then, but is it feasible? The first problem is that of a clock source. Trading systems will need to synchronise themselves to some ‘golden source’ of time. read more

Mitigating risk with an investment book of record

Paul Westgate, Linedata

Jul 15, 2014
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Over the past couple of years, the Investment Book of Record (IBOR) has been a topic increasingly seen in articles, interviews and conferences. The fact that it is still widely discussed, suggests that, although far from a new concept, its precise nature is not clearly defined. Today the debate is perhaps more about how an IBOR will be delivered and how it will operate rather than what it will offer. Different business types will have different needs and this will govern exactly what practical implementation is needed, along with their size and operational model. read more

SEEKING OPTIMAL ETF EXECUTION IN ELECTRONIC MARKETS: PART 1

Mike Baradas, Bloomberg Tradebook

Jul 14, 2014
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Exchange Traded Funds (ETFs) have had a phenomenal run in recent years, with both their number and assets under management (AUM) growing dramatically. Despite this rapid growth, the average daily exchange traded volume of these ETFs has stalled and now appears to be in decline. However, on screen liquidity is not a true reflection of an ETF’s total implied liquidity, which comprises of liquidity of the underlying basket, related derivatives, correlated trading vehicles and exchange traded volume. Due to these properties, traders need to understand the uniqueness of ETF market microstructure and utilize the right trading solutions to achieve optimal execution efficiency. read more

Bringing surveillance to Europe

Robert Powell, Etrali

Jul 11, 2014
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European compliance officers are facing a raft of new proposals driven by MIFID II. These range from: Transparency and Data Publication through to Investor Protection. Inside the Investor Protection proposals are some subtle, but important, changes to the records retention requirements. The proposals form part of the consultation and discussion paper issued by ESMA following the politically agreed text of the MIFID II European Directive. Although the records retention changes are just a small part of the discussion they represent a seismic shift in the way that European regulated firms deal with records retention. read more

Getting Fit For Summer

IPC

Jul 10, 2014
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We all feel the urge to get in shape now that summer’s on the way. However, this isn’t always straight forward, and often the best results come when you’re working with a personal trainer, dietician or physio. This trend continues into the financial markets, where every participant works hard to be leaner, fitter and more competitive. Firms are reducing costs and increasing efficiency by using managed services to provision, maintain and future-proof their IT infrastructure. We surveyed over 100 Front and Back office executives at the recent TradeTech expo in Paris to hear their views on allocating resources, calling in the experts and getting fit for the summer. read more