Wall Street Letter VOL. XLVI, NO. 7 - July 2014 | Page 14

NEWS

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“We are not seeing a complete
adoption across global brokers yet,
but we’ve gotten a range of different
responses coming back and it is not
lack of willingness, but a matter of not
having the capabilities needed available to them,” said Lees.
Lees noted that one concern relating
to FIX tags and transparency is that
firms are essentially lifting the hood of
their algo engines and exposing mission critical technology to the market.
“We haven’t had anyone say with
certainty that they would have issues
with providing routing information,
but it is a common question that is
raised during discussions. We’ve only
discussed this concept with a couple of
large firms and they are of the opinion
that the data could be provided,” said
Lees. “In our experience to date, there
seems to be consensus that the client
is entitled to see the routing decisions made on their behalf and that
this supersedes concerns over reverse
engineering of algorithms.”
TECHNOLOGY

Service providers
with HFT focus to
broaden for survival
Vendors thriving off of a high-frequency trading-focused client base will
have to diversify in order to stay in the
game, according to comments from
telecom executives serving the financial services industry in New York.
During a panel discussion on the
modernization of Wall Street at the
Telecom Exchange conference in
New York last month, Eric Contag,
chief operating officer of GlobeNet,
a Florida-based broadband provider,
said while HFT activity is getting a
lot of attention right now, it’s a small
piece of the financial industry that
could disappear.
“If your entire business is just based
on those then you better do the best
you can for as long as it lasts,” he said.
“But if you’re good then you can start

EXCHANGES & ATSs

ISE adds authority to address tech malfunctions

T

he International Securities Exchange is
proposing new permissions to address
error trades that occur due to malfunctions
of its own technology, joining the ranks of
other options exchanges that have done the
same in recent months.
ISE told the SEC in a regulatory proposal
the rule would essentially serve as a way
to address the issue in place of final rules
that have been agreed upon across all the
US options exchanges as to how to handle
catastrophic and obvious errors.
The options venue said in the event on