A group of 10 buy-side and sell-side entities, as well as industry associations, have jointly released a set of recommendations for the upcoming equities consolidated tape provider (CTP) in the EU, reports The Trade. The parties are endorsing a tape where data is “disseminated to users with an end-to-end latency of 100 milliseconds or faster”, for “as low a price as possible”.
The contributors believe that there should be no regulatory obligation to use the tape. Rather, usage should be voluntary – and low latency and price are the factors that will likely encourage the greatest number of users.
Accessibility is important
For post-trade, the CTP should “report in a single currency at ISIN level so as to better represent the ‘pan-EU market tradability’ of these instruments”. Efforts should be made to get the EU and UK tapes to converge to “allow for maximum integration, and subsequent usability across the regions”. This could involve setting up common principles in technical specifications, communication protocols, data fields, and CT accessibility.
Other recommendations put forward include having the CTP “leverage established industry standards when it comes to transmission protocols, with the data stream made easily available on firms’ ‘usual’ terminals”. Pre-trade data should be handled correctly, with attributed data “included from the outset”.
Teamwork
Controversy has followed the consolidated tape discussion, as illustrated in this article. In the equities arena, a dilemma over regulators’ desire to improve competition between trading venues and the trading venues’ reluctance to forgo revenues from data is playing out.
These recommendations are based on the 2022 Adamantia feasibility study done by a group of buy-side and sell-side entities. The 10 contributors are Barclays, BlackRock, BNP Paribas, Credit Agricole CIB, Invesco, Société Générale, Association for Financial Markets in Europe (AFME), Association Française des Marchés Financiers (AMAFI), European Fund and Asset Management Association (EFAMA), and FIA European Principal Traders Association (FIA EPTA).
