Commentary

Ivy Schmerken
Traders Magazine Online News

MiFID II Transparency Puts Stress on Data Architecture

Buy-side firms are facing huge changes in disclosure and transparency requirements, which could upend their data management architectures, according to this guest commentary from FlexTrade.

Traders Poll

Are you concerned about foreign ownership of a U.S. stock exchange?



Free Site Registration

January 2, 2014

Buyside Can Now Grade Its Brokers

By

John D'Antona Jr.

The buyside can now grade the performance of its brokers, evaluating how the services they provide-such as research, management access or execution-stand up to one another.

The availability to grade a broker comes amid a growing emphasis on the buyside on how to best pay its research bills, according to Instinet. Through the agency-only broker's commission management platform, buyside users can set specific parameters for grading, such as comparing all brokers to one another, or only to its peer group-agency-only, etc. Once the data, usually collected as part of the broker vote process, is compiled and analyzed, a report card is generated and can be sent to the broker as part of a regular evaluation.

The new grading functionality is part of an upgrade to Instinet's Plazma commission management system.

Another upgrade is the T*Share credit aggregation program, which allows the buyside to direct all its commission credits amassed at multiple brokers into a central repository. A buysider's brokers must be part of T*Shares to deposit an institution's credits.

Luke Mauro, global head of operations at Instinet, explained that having different and separate soft-dollar and CCA/CSA balances is a big obstacles to managing a commission budget.

"Clients globally continue to embrace CSAs/CCAs, but as a consequence they often end up with half a dozen or more open accounts, creating a logistical headache," Mauro said. "T*Share helps institutions solve this hassle without forcing them to sacrifice execution relationships with their preferred CSA brokers."

 


(c) 2014 Traders Magazine and SourceMedia, Inc. All Rights Reserved.
http://www.tradersmagazine.com http://www.sourcemedia.com/