big xyt releases new free tool for trade verification
big xyt, the independent provider of smart data and analytics solutions to the global trading and investment community, today announced the release of the Trade Verification Tool, a new interactive service which returns the verification of price reversion and execution performance on any trade instantaneously.
The big xyt Trade Verification Tool leverages the sophisticated analytics engine of its Open TCA solution for pre and post-trade execution analytics and provides transparency on ETF execution quality. The new tool enables users to quickly verify suspicious trades without being exposed to the complexity of a fragmented market.
Currently covering ETFs across more than 30,000 listings in Europe alone, this new tool is available free of charge to registered users.
Users can easily verify any trade of a security at any point in time with various metrics measuring liquidity before and after the trade such as mid-price movement, changes in spreads, and changes in volume at-touch. The metrics are visualised and provide immediate insight.
Secondary markets for ETFs in Europe show a significant proportion of RFQ trading; it has been growing over the past few years and reached more than 50% in 2023. Trading with non-lit mechanisms (such as RFQs or Systematic Internalisers) may expose the participant to market impact and/or information leakage and thus higher trading costs. To understand the total cost of trading, market participants should review the quality of execution by using reliable post-trade analysis.
While an increasing number of buy-side firms observe changes in liquidity on screen while trading on RFQs, a poll during a buy-side workshop at TradeTech 2023 indicated that the majority of buy-side firms (23 out of 25) use the time of execution to benchmark execution performance when trading ETFs. This is highly inaccurate and does not provide any information on changes of liquidity during the trading process (usually several seconds either side of the RFQ execution time) such as price movement, reversion, or the widening of spreads.
Robin Mess, CEO and Co-founder of big xyt, commented: “We’re always discovering opportunities and developing new solutions to help the community gain more transparency and better actionable insights to reduce their trading costs. We’re excited to offer the Trade Verification Tool to the industry, and as part of our broader Open TCA solution, investors can systematically process all orders and trades to find the most relevant information, quickly and easily, which helps with day-to-day trading decisions.”
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