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Interactive Data Leverages Pricing, Reference Data for MiFID Offer

Interactive Data Corp is leveraging the assets of its Pricing and Reference Data unit, as well as those of its Real-Time Services group, to offer a range of services aimed at helping clients meet their obligations under the EU’s Markets in Financial Instruments Directive (MiFID). 

Interactive Data believes its real-time and reference data services units can help customers fulfill MiFID requirements covering pre- and post-trade transparency, evidencing best execution, trade venue selection and reviews of order execution policy, code of conduct and client classification obligations, transaction reporting, managing conflicts of interest and managing risk.

Roger Sargeant, managing director of Interactive Data (Europe) Ltd, says: “We have undertaken development initiatives of a similar size to our MiFID project in the past across our businesses – our ticker plant consolidation was a huge cross-divisional effort, and our work in preparation for Sarbanes-Oxley, Y2K and EMU for example also required business-wide consolidation. However, I would say this is the broadest cross-divisional product development issue we have tackled.”

The company says its MiFID research and planning has been under way for “well over two years”. The MiFID project has been led from Europe by Bob Cumberbatch, business lines director at Interactive Data (Europe). Cumberbatch has created a cross-function project team with representatives from all parts of the Interactive Data business globally, and a MiFID Executive Group with representation by the heads of the different businesses. This structure, says Sargeant, will be maintained “for as long as required, before MiFID becomes part of ‘business as usual’ – which I wouldn’t expect to happen for 12 months, at least.”

As part of the MiFID drive, Interactive Data will be offering up both existing and new reference data sources from its Pricing and Reference Data unit that will be used to identify trading venues and types using location codes. The Pricing and Reference Data unit will also help identify the most relevant market for any given traded instrument, and will define whether an instrument is within the scope of MiFID, the instrument type, and whether it is considered complex or non-complex under MiFID. The data will identify the classification of a financial instrument code (CFI), the Unique or Unambiguous Instrument Identifier (UII), a share’s liquid status and its deferred publication delay potential.

Interactive Data will also offer Pricing and Reference Data’s tools for helping post-trade pricing operations departments of investment firms calculate funds’ net asset values (NAVs) or to value a portfolio. Where no current market price is available, clients are able to use the company’s Fair Value Information Service.

Sargeant maintains that it will be relatively straightforward for clients to access the new MiFID data. “It will be delivered via the same service that clients are already taking, and in the same formats: this will not be a challenge for clients.” Cumberbatch says the company’s most comprehensive MiFID reference data offering will be available via its existing FTS delivery channel.

“Some of the things we are doing to gather this data go above and beyond the standard reference data requirements and we believe there is commercial value associated with the content,” Sargeant says. “We have not yet finalised our approach to pricing this for the market, but we have invested a lot of resource to get some of the data, and that does have a commercial value.”

Adds Cumberbatch: “We have identified an extensive range of elements, and have had to extend our reference data repository to accommo-date them. A lot of the data has to be sourced manually, so as well as the development that we are undertaking, there is the investment in manual editorial staff to source the data.”

The company’s pricing source and reference data stores will be able to accomodate requirements yet to be published by regulators in time for testing before the November 1 live date, Cumberbatch says.

“We are encouraging all our clients to get in touch with us and explore their MiFID reference data requirements. The interest our clients have so far shown in MiFID solutions is in large part dependent on the individual firm – whether they see MiFID as an opportunity to either make more money or reduce costs, and whether they understand what their obligations will be post-MiFID. Many want to make sure that when they need MiFID related data, we will be in a position to provide it.” Cumberbatch says some clients are ready to contract to receive the data. “By mid-year, I think that firms will be increasingly waking up to the impact of MiFID,” he says, “and we will see the bulk of demand emerging around Q3/Q4, in some cases possibly a little later.”Interactive Data Corp is leveraging the assets of its Pricing and Reference Data unit, as well as those of its Real-Time Services group, to offer a range of services aimed at helping clients meet their obligations under the EU’s Markets in Financial Instruments Directive (MiFID). 

Interactive Data believes its real-time and reference data services units can help customers fulfill MiFID requirements covering pre- and post-trade transparency, evidencing best execution, trade venue selection and reviews of order execution policy, code of conduct and client classification obligations, transaction reporting, managing conflicts of interest and managing risk.

Roger Sargeant, managing director of Interactive Data (Europe) Ltd, says: “We have undertaken development initiatives of a similar size to our MiFID project in the past across our businesses – our ticker plant consolidation was a huge cross-divisional effort, and our work in preparation for Sarbanes-Oxley, Y2K and EMU for example also required business-wide consolidation. However, I would say this is the broadest cross-divisional product development issue we have tackled.”

The company says its MiFID research and planning has been under way for “well over two years”. The MiFID project has been led from Europe by Bob Cumberbatch, business lines director at Interactive Data (Europe). Cumberbatch has created a cross-function project team with representatives from all parts of the Interactive Data business globally, and a MiFID Executive Group with representation by the heads of the different businesses. This structure, says Sargeant, will be maintained “for as long as required, before MiFID becomes part of ‘business as usual’ – which I wouldn’t expect to happen for 12 months, at least.”

As part of the MiFID drive, Interactive Data will be offering up both existing and new reference data sources from its Pricing and Reference Data unit that will be used to identify trading venues and types using location codes. The Pricing and Reference Data unit will also help identify the most relevant market for any given traded instrument, and will define whether an instrument is within the scope of MiFID, the instrument type, and whether it is considered complex or non-complex under MiFID. The data will identify the classification of a financial instrument code (CFI), the Unique or Unambiguous Instrument Identifier (UII), a share’s liquid status and its deferred publication delay potential.

Interactive Data will also offer Pricing and Reference Data’s tools for helping post-trade pricing operations departments of investment firms calculate funds’ net asset values (NAVs) or to value a portfolio. Where no current market price is available, clients are able to use the company’s Fair Value Information Service.

Sargeant maintains that it will be relatively straightforward for clients to access the new MiFID data. “It will be delivered via the same service that clients are already taking, and in the same formats: this will not be a challenge for clients.” Cumberbatch says the company’s most comprehensive MiFID reference data offering will be available via its existing FTS delivery channel.

“Some of the things we are doing to gather this data go above and beyond the standard reference data requirements and we believe there is commercial value associated with the content,” Sargeant says. “We have not yet finalised our approach to pricing this for the market, but we have invested a lot of resource to get some of the data, and that does have a commercial value.”

Adds Cumberbatch: “We have identified an extensive range of elements, and have had to extend our reference data repository to accommo-date them. A lot of the data has to be sourced manually, so as well as the development that we are undertaking, there is the investment in manual editorial staff to source the data.”

The company’s pricing source and reference data stores will be able to accomodate requirements yet to be published by regulators in time for testing before the November 1 live date, Cumberbatch says.

“We are encouraging all our clients to get in touch with us and explore their MiFID reference data requirements. The interest our clients have so far shown in MiFID solutions is in large part dependent on the individual firm – whether they see MiFID as an opportunity to either make more money or reduce costs, and whether they understand what their obligations will be post-MiFID. Many want to make sure that when they need MiFID related data, we will be in a position to provide it.” Cumberbatch says some clients are ready to contract to receive the data. “By mid-year, I think that firms will be increasingly waking up to the impact of MiFID,” he says, “and we will see the bulk of demand emerging around Q3/Q4, in some cases possibly a little later.”

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