Thomson Reuters to Launch Real-Time Consolidated Tape in Europe
November 9, 2010
Global data giant Thomson Reuters will launch a consolidated tape product over the next 12 months that will provide prices in real time on more than 6,400 stocks.
Such a move would put Thomson Reuters in compliance with potential changes to the Markets in Financial Instruments Directive in Europe now being reviewed by the Committee of European Securities Regulators, say Thomson Reuters officials. The new version of MiFID is coined MiFID II.
Currently, Thomson offers consolidated post-trade data on about 1,800 European stocks. This comes with a 15-minute delay.
The new product will offer real-time data to retail investors for free on 6,436 stocks which are recognized by the Committee of European Securities Regulators as “shares admitted for trading on EU regulated markets,” says Andy Allwright, business director for MiFID solutions at Thomson Reuters.
Since the introduction of the Markets in Financial Instruments Directive in Europe (MiFID) three years ago, new alternative trading venues have quickly emerged to compete with incumbent exchanges such as the London Stock Exchange and Deutsche Borse. One of the unintended consequences of such market fragmentation for fund managers and broker-dealers is that they have been unable to either benchmark the performance of their trade executions or make trading decisions because they don't have timely and accurate sources of data. They have also argued that its too expensive to keep track of the data. As a result, exchanges are now
The UK’s Investment Management Association (IMA) has said that MiFID led to a deterioration in the quality of information available to buy-side traders and called for the creation of a central data repository, modelled on the US consolidated tape system. The need for a consolidated tape was also highlighted when the LSE's TradElect system was hit by connectivity problems for a whole day in November 2009 and many traders did not switch to other platforms - such as Chi-X and Turquoise – because they still relied on the LSE to provide benchmark pricing.
Since then regulators have been urging the securities industry to make improvements or face more regulation which data vendors such as Thomson Reuters oppose. In July CESR recommended the creation of so called Approved Publication Arrangements, entities that would be responsible for cleaning data for consolidation. In October, CESR called for the creation of different flags to identify different types of trades in post-trade data.
