By Maria Natalie, EMEA Regional Director, FIX Trading Community
Maria Natalie, Fix
without a fixed trade The ability to provide a transparent market for the community, the global regulatory community, would be nearly impossible. This seems like a pretty broad statement for the community, so let’s see what we mean by that.
Regulators almost invariably strive for more transparency in the “markets,” but what does that really mean? Transparency is the way through which all users of the markets, whether individuals, professional investors or large corporations, can clearly see what is happening in our markets. However, markets are not simple and a trade between two participants would be nothing more than a transaction between the other two. The most important part of transparency is understanding the actual circumstances of each individual company – without this information, the data becomes meaningless.
Additionally, each region, country, and jurisdiction has different rules. The rules are often of a high standard and are then enforced in slightly different ways – the result is that users start to lose or find it difficult to trust the data and understand what they are seeing in the markets deny. Only when the data is clear and unambiguous can regulators fulfill their duty to monitor and monitor the market.
So what exactly is required to ensure markets are transparent and clear to users and those responsible for their security?
Global financial markets need clear standards and clear guidelines. They require repeated explanation (not to correct statutory failures); quality data; constant challenge; and resilience to change. Finally, markets must be able to properly condemn those who do not follow the letter or spirit of the rules.
So where does FIX fit in? Market participants must be able to create value and increase revenue through their work, but human nature will prompt companies to adapt their ideas to their individual needs and motivations. This means that regulators are taking drastic measures on a daily basis to understand the nuances of the intricacies of the market without getting the full picture. All market participants are represented (as they should be) by an army of industry organizations that advocate for them and defend their business models, and these groups will have as many disagreements as they have to defend. business models for.
The FIX Trading Community is a unique organization that represents the provision of data to all market participants and has managed to move away from any discussion that deviates from the ultimate goal of clear standards.
The organization is uniquely positioned to bring market participants together to provide standards and guidelines in a professional environment where members are constantly reminded to “leave your corporate hat at the door”. It may seem like in the corporate world it’s hard to understand how companies do it, but at the end of the day there is a clear business reason for companies to work together. Regulations such as death and taxes are inevitable, and keeping compliance costs to a minimum is only possible by using good, well-defined standards.
The FIX Trading Community has been in existence for almost 30 years (the first FIX Committee was formed in 1994) and the organization continually works to improve efficiency, lower operating costs and reduce the operational risk of the markets.
The focus of the community over the last few years has been to keep up with the pace of change and ensure that the FIX protocol remains a relevant comprehensive extension, guidance and recommended practice.
The FIX trading community, working with its members, can provide these standards and guidelines. They are in a central position to understand each proposal, provide the markets with a detailed understanding of trade flows and where the pitfalls lie, and guide rule-setters towards meaningful regulatory standards. and avoid unintended consequences. Also at the core of good standards is understanding what is good data and what is bad data, and how bad data can be cleaned up and sorted out.
The FIX trading community does its job well, but it can only do it well with the support of our members. This includes financial backing to enable the mechanics of the process, as well as support from companies to give their teams a place to engage and provide critical input across the industry spectrum (buy-side, sell-side, vendor, Venue – everyone has a part to play).
However, we cannot do everything. The FIX trading community cannot monitor the markets – which should remain the responsibility of our regulators, but we can still offer advice on data issues and what can be done to resolve them for good transparency.
Be part of the solution and get involved.
The FIX Trading Community is currently involved in several important initiatives including,
With the further development of the conditions and the buyer/seller side, the desire for more detailed transaction data increases. It is important to further develop the FIX protocol to ensure that new data is available in a common and clear way. The expansion and introduction of new fields and values in the region have supported this development. But even after the protocol has been expanded, regular review of implementation across the industry allows working groups to provide further guidance as needed.
Transaction Cost Analysis (TCA),
This work has enabled the creation of industry-wide terminology, guidelines and best practices that allow for a more consistent assessment of the company’s investment process and costs.
Post trade transparency and European consolidated bands,
We have further developed the MMT (Market Model Typology) standard for company classification, which is now being adopted by all major European stock exchanges and APAs. In addition, the FIX protocol is used for most APA annual reports across Europe. We are extending both the MMT and FIX protocols to support ESMA and FCA changes in post-trade transparency rules in Europe and the UK. We are also writing the definition of addressable liquidity and refining our liquidity classification guidance.