Can we FIX the consolidated tape? – 30 July 2010
First Published Friday, 30th July 2010 02:06 pm from Fidessa : Fidessa
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target="_blank">FIX Protocol EMEA quarterly briefing
yesterday evening and was asked to sit on a panel to discuss the
impact of MiFID II, especially in light of the
href="http://www.cesr.eu/popup2.php?id=7003"
target="_blank">CESR recommendations that were
published the same day. Whilst it was clear that some of my
fellow panellists had had more chance than me to read and digest
all 162 pages of the report, the thorny issue of having a
consolidated post-trade tape featured strongly in the
discussions.
The problem is that without
clear, timely and complete execution data it's
difficult for the buy-side to understand liquidity patterns and
evaluate execution quality properly. This goes right to the heart
of MiFID's original objective as it's pretty
difficult to demonstrate best execution if you can't
measure it accurately. This was tricky enough pre-MiFID but is
made harder still by the fact that the multitude of new venues
that have emerged since November 2007 all unilaterally created
their own (often conflicting) acronyms for describing different
trade types.
The intriguing possibility was
href="http://www.fixprotocol.org/"
target="_blank">FPL themselves could play a role in
trying to agree a common set of standards for the production of
such a tape. Once the rules were agreed then it could be left to
market forces to allow different firms to create and market their
href="http://www.fixprotocol.org/"
target="_blank">FPL represents a very well respected
professional body that has done a great job in developing and
href="http://www.fixprotocol.org/what-is-fix.shtml"
target="_blank">FIX Protocol across the finance
industry. And, crucially, it is one of the few organisations that
is consistently able to get market participants to set aside
their own vested interests for the greater good of the
industry.
It's an important issue
because if we can't sort this out for ourselves, then
target="_blank">CESR will come along and take our
toys away completely and impose a utility based Mandated
Consolidated Tape (MCT) as we have in the US. If title="CESR" href="http://www.cesr-eu.org"
target="_blank">CESR does go down this route then
it's hard to see how the whole thing wouldn't
be hijacked by all the different political interests of
Europe's member countries which would be to the
detriment of everyone.
Anyway, have your
say:
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