Under new MIFID II proposals the responsibilities bestowed on an individual executing trader will be under increased internal and external scrutiny. For their part, they will now be expected to be a source of alpha and value-add in the investment process whilst also providing direct accountability for the best execution of every order on the firms pad under their supervision.
In the third blog of our Preparing for MIFID II series, we showcase how OTAS’ intelligent In-Trade technology is enabling traders to become more efficient through the life of a trade, by being active by exception. This means using advanced artificial intelligence techniques to monitor idiosyncrasies in live stock behaviour and informing traders so that they are able to reassess and reselect the best strategy for their orders in reaction to changes in real-time market information. Put simply, traders can now take real ownership of their trade blotter, optimizing their flow to the orders where they can have most impact and by providing transparent, recordable visual evidence for the basis of their decision making.
Our Microstructure charts use quantitative modelling to predict the expected daily forecasts for a range of stock trading metrics including price return(absolute and vs basket,) volumes, liquidity and spread. If during the course of an order any of these live stock conditions trade in extreme of these forecasts(through impact caused by the trader or general market) it is considered a potentially actionable signal for the trader and a visual Alert is fired. Further important price sensitive information is also relayed via the Alerts including outsized Dark/OTC volume, live company Insider transactions and Peer Event reporting.
Extensive market intelligence tools including total volume and closing auction forecasts, venue breakdown analysis(Dark & Lit), V.A.P and latest News are also provided within the Microstructure stack.
Key Benefits of Microstructure & Alerts:
- Systematically monitor trade blotters of any size, using an exception based approach.
- Course correction of orders in response to realtime Alerts
- Alert metric(s) selectable by client preference including trigger threshold/sensitivity.
- Microstructure and Alerts recorded to provide visualization evidence of traders decision process.
- Extensive volume analysis across Lit & Dark markets
Additionally, our In-Trade Performance function allows traders to monitor live order performance against specific client execution instructions or a range of strategy benchmarks. It also allows them to perform real-time analysis of the direct impact of their trading decisions on execution price(slippage) and participation rate.
A large majority of our EMS partners now have OTAS In-Trade components directly embedded into their trading platforms, meaning their clients are already benefiting from fully integrated, optimizable execution processes. These are just three of a whole suite of bespoke real-time trading applications we have created to help Global Trading desks provide a systematic approach and facilitate ‘sufficient steps’ under the guidelines and framework of MIFID II.
Contact us now to explore the current apps available within your EMS and how we can assist your current execution policy or technology mandate at email@example.com
***OTAS has been nominated for the Intelligent Trading Technology Awards 2017 under the Best Trading Analytics Platform category. Please vote for us using the following link – http://resource.datamanagementreview.com/intelligent-trading-technology-awards-2017-survey . Voting is open through April 21, 2017. Winners will be announced at the Intelligent Trading Summit on June 8.***