Reuters (NASDAQ:RTRSY)(LSE:RTR) is offering clients the ability to see the best bid and offer price on major stocks wherever they are quoted from today. The consolidated price will enable clients to comply with the Markets in Financial Instruments Directive’s (MiFID) best execution requirements via a special type of Reuters Instrument Code (RIC) known as “. x”.
These RICs will bring together data on all trades around a stock as they happen so that best bid/offer data from all relevant exchanges will be available. Banks need a cost effective means of consolidating data in one place to allow them to comply with MiFID which comes into force on next week on 1(st) November.
Currently trade and price data on individual stocks is concentrated on individual exchanges but the introduction of MiFID is likely to mean that this will be split between more than one exchange or publication venues, causing price visibility to fragment. In the US this problem has been solved by a national best bid and offer price mandated by the Securities and Exchange Commission (SEC). MiFID explicitly leaves market forces to provide the same solution in Europe, a stance to which Reuters is responding to with the “.x” RIC.
Reuters is already committed to offering the tools its customers need to comply with MiFID and launched Reuters Trade Publication earlier this year, to provide a cost effective means for firms to publish trades they execute away from exchanges.
Under MiFID all investment firms will be required to show transparency by publishing data on all trading activity that does not take place on an exchange or Multilateral trading Facility (MTF) immediately after a trade is done.
Stephen Wilson, Global Head of Exchange Traded Instruments at Reuters said “Our customers know that MiFID is the biggest regulatory change to hit European markets in the last twenty years. That is why Reuters is offering them the key tools they need to comply with the new regulations. It is crucial for them to know what the best bid and offer on any major stock is, wherever it is quoted, and the new Reuters .x RIC will allow them to do this.”
