The FIX Trading Community, the industry association that manages the world’s trading language, the FIX Protocol, has called for greater post-trade transparency in its response to the Financial Conduct Authority’s Consultation Paper CP25/20: The SI regime for bonds and derivatives including discussion paper on equity markets.
FIX Executive Director, Jim Kaye, said the discussion paper section was an opportunity to address legacy issues that have dragged on markets for decades.
“Post-trade data quality issues create noise that makes it difficult for investors to make an accurate assessment of market depth and liquidity,” he said. “We have recommended clearer definitions and consistent use of trade flags to eliminate noise — such as non-price-forming or duplicative trades — and improve data quality, which in turn will improve investor confidence in market data.”
Mr Kaye also emphasised that duplication of trade reporting was an issue for both UK and the broader European market, artificially inflating volumes. “Our response recommends recognising off-venue EU trade reports in the UK,” he said. “This would streamline obligations and reduce complexity.”
The response also recommends mandating the use of separate market identifier codes (MICs) for mid-point and lit trading activity, to ensure market data quality is maintained under the proposal to reformulate the reference price waiver. FIX also supports allowing mid-price referencing from a broader range of venue services.
FIX’s response was formulated by FIX Trading Community’s fixed income and equities consolidated tape working groups, both of which have representatives from market operators, sell-side firms, buy-side firms and vendors. The working groups are ongoing and interested parties are encouraged to engage with FIX to participate.
The FIX Trading Community is the only independent global community where capital markets firms come together to solve common issues and shape the evolution of capital markets. FIX groups in over 60 countries are working on a range of global issues including digital assets; reference data; carbon trading; AI; algo trading; FICC and ETFs, while country and regional committees work together to manage local regulation and market structure matters. To see what FIX can do for your firm, visit www.fixtrading.org.
