Interactive Data Corporation’s Pricing and Reference Data business has added more data, including a daily market commentary on the fixed income markets, to support its fixed income evaluations services. The vendor says it decided to provide more information within the service free of cost to its client base with a view to increasing transparency into its evaluations. It has also promoted Interactive Data veteran Liz Duggan to chief operating officer of its Evaluated Services business, as another part of its drive to strengthen its valuations business.
These moves are set against the background of an increasingly competitive valuations market, as more vendors enter the fray and the rest of the vendor community ramp up their offerings. A recent example of this trend is Standard and Poor’s addition of the Valuation Scenario Services for Structured Asset Portfolios to its Fixed Income Risk Management Services business.
Shant Harootunian, managing director of Evaluated Services, explains how it is fighting back the competition: “Interactive Data is committed to providing clients with transparency and an expansive set of informational resources related to the inputs we use to produce our independent evaluations of fixed income securities.”
According to Interactive Data, the new informational resources are designed to help clients better understand the evaluations that are provided and the impact that daily market conditions may have on these evaluations. The vendor also reckons they will help clients prepare for their obligations under Financial Accounting Standards Board’s Statement of Financial Accounting Standards 157 (FAS 157).
Accordingly, it has introduced a daily market commentary that reflects activity in the US fixed income markets as of midday. These market observations are now delivered to clients via email at approximately 2pm ET, but the commentary is also scheduled to be available through Interactive Data’s desktop service for clients in the first quarter of 2009.
Other information that has been made available to its client base includes: evaluations input reports, corporate tolerance reports, municipal high yield flat evaluations and broker quoted securities reports, and EVS documentation. These evaluations input reports provide historical details on the market inputs for a selected sample of security evaluations and are designed to provide clients with additional information for their fair value hierarchy determinations under FAS 157.
The daily corporate tolerance report is available for US corporate bonds and US convertible bonds and it identifies all securities whose percentage change in evaluation from the previous day is equal to or greater than a predetermined tolerance level. Interactive Data claims that this report can therefore assist mutual fund clients in their daily review of evaluations.
Interactive Data also provides access to current and historical lists of municipal high yield securities that it categorises as ‘flat’ because they do not move with the market and are not interest rate sensitive. On a daily basis, the vendor also compiles a list of broker quoted US corporate bonds, CMOs, ABSs, CDOs and CMBSs. Broker quotes are provided for certain securities when sufficient information is not available to produce an evaluation and information is updated based on receipt of updated quotes from market makers or broker-dealers, says the vendor.
Moreover, the vendor indicates that clients can now access a variety of evaluations related documents via its desktop including a FAS 157 position paper, summary of inputs by asset class and methodology documents that outline the evaluation process.
The appointment of Duggan to chief operating officer of the valuations business is also part of the vendor’s attempts to raise its competitive game. Accordingly, in this newly created role, Duggan and her team will work with clients to accelerate the development of new services and the addition of new capabilities while continuing to focus on providing customer service and support, says the vendor. She will report directly to Harootunian.
Duggan joined Interactive Data in 1999 and has held several roles within the company. In her most recent position as vice president, market specialists, she was in charge of client relationships and contributed to the growth of the vendor’s institutional business.