Thursday, January 3, 2019

Trade the News: Wall Street goes to war over market data and access

Great post from Trade the News summarizing the market data access and fees battle underway on Wall Street: 
At the heart of the debate are the SIPs – or Securities Information Processor feeds – which are real-time consolidated feeds of trade and quote data, including ‘top of book’ quotes for stocks consisting of each exchange’s best bid price, thus providing key information on the national best bid and offer (NBBO) for NMS stocks.
Investment banks, broker-dealers and trading firms argue that SIP and direct data feeds are grossly overpriced considering how little they allegedly cost to produce and how important they are in terms of regulatory compliance
The exchanges, specifically in this case Cboe’s Concannon, argued that SIP revenue has been flat-to-down over the past decade and that firms have a choice when it comes to purchasing direct data feeds and market access due to increased competition. Concannon took no prisoners when delivering his opening statement to the SEC, highlighting that the debate has led to a battle between Wall Street and the regulated exchanges around profits and economic frets.
Excellent summary of the battle lines and stakes in this all important market data conflict.

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