EQUITIES
Now we’re onto an OMS upgrade, EMS
upgrade and have just changed TCA
provider. The only constant is change! I was struck by a comment that I heard
from Tilman Lűder at an event a few
years ago, where, he said (and I’m
paraphrasing slightly) “I never hear from
the buyside about what it is you want”.
Part of the reason I decided to take
on external roles was to try to bridge
this perceived divide to the regulators.
It is one thing going to a conference
and listening to the regulator but it is
another to actively engage with them.
How about the desk in London
specifically? On that front, I was delighted to
go to Brussels with a number of
peers recently for a workshop on
The individual and collective thought
process has been crucial, and we have
been working globally on matters
such as improving our Best Execution
process and materials as well as creating
a new qualitative and quantitative
broker review process.
Report which discussed this in more
detail and propose we pursue it.
We believe a Consolidated Tape is
much needed. The simple fact is most
of the buyside do not know what
the true addressable volume is in a
stock on a given day. So, from a Best
Execution point of view, you aren’t
able to judge the true performance.
At a higher level, I’d like to think a
Consolidated Tape would help capital
markets formation, such as by helping
portfolio construction. If we are
looking to initiate in a position, we
I joined nearly three years ago and
have loved (almost) every minute. The
daily interaction with active managers
who want to engage and adding some
value to their process remains the most
rewarding part of the job.
One tangible result this year has been
a significant year-on-year increase in
algorithm usage, which has reduced our
explicit costs but, more importantly, an
even more significant reduction in our
implicit costs.
A less tangible result has been a
more proactive, forward-thinking
team. Empowering all of the team
and helping them develop and thrive
continues to be very enjoyable. Their
diversity of thought and collective
mindset is fantastic and I’m proud of the
progress we’ve made together.
The regulatory and administrative
side can be an obstacle but reducing
risk and improving processes is a
constant evolution. One of the changes
we implemented was to bring a
compliance team member onto the
desk.
Richard at the 19 th ATF Equities London
the Consolidated Tape. That was
an exciting first step and I hope we
continue to pursue this hard as an
industry.
Of course, there is still lots to work
on, whether it be the Share Trading
Obligation, the value of Periodic
auctions or preserving mid-point to
name a few.
You mentioned the regulators earlier.
How do you see regulation changing? Do we need a Consolidated Tape
and is it achievable?
It’s hard to know but if you want
change, you really have to help drive it,
so I try to be proactive in every part of
my job. We certainly do but a Consolidated
Tape is a huge undertaking. I was
however extremely encouraged by
the recent ESMA MiFID II/MiFIR Review
Winter/Spring 2020
www.buysideintel.com
will use Bloomberg primary as our
reference to assess liquidity. However,
that is not a full analysis of the volume.
If we look at the Composite EU, we
often see volumes that are 30-50%
above the primary but we don’t truly
know how addressable that is so we
can’t use it. Ultimately, in one example
this year, that stopped us from
investing in a stock that is up over 60%
year to date, and that is a significant
opportunity lost.
There is an argument that cleaning the
data would improve much of this but
a full Consolidated Tape should be the
end goal. The PlatoMetrics platform
I mentioned earlier is a great start
but it needs to be mandated by the
regulators.
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