MiFID
The Markets in Financial Instruments Directive (MiFID) and SunGard
MiFID is a set of regulations from the European Commission that was adopted by EU member states in 2006 and enforced by national financial regulators from 2007. It has been designed to increase investor protection by encouraging greater transparency, and improve market efficiency by stimulating competition for order flow. MiFID will change the trading landscape for most financial instruments, requiring a rethink of process as well as technology.
MiFID software solutions
MiFID: Recordkeeping
MiFID requires companies to store a large variety of records for a period of at least five years. SunGard’s MiFID Hub integrates with a financial institution’s front-, middle- and back-office systems, dynamically capturing and consolidating information for archiving on durable media, helping firms meet the increased recordkeeping requirements imposed by MiFID.
MiFID: Systematic Internalisation
Internalising trade order flow is a key business opportunity resulting from MiFID. Financial technology research firm Celent estimates that annual trading profits from internalisation could top €1 billion, representing "72% of all new revenue and/or cost saving opportunities for investment firms under MiFID." FRONT ARENA offers a proven and tested solution for internalisation that is already supporting high volume trading at client sites across Europe.
MiFID: Order Management
MiFID means that investment managers will have access to a broader range of execution venues and options. Decalog offers a portfolio management system that allows investment managers to make full use of these options in search of best execution. Decalog is expanding connectivity to additional liquidity sources and trading venues and offering direct market access (DMA) capabilities to take advantage of limit order handling rules.
MiFID: Transaction Network
MiFID will drive networking requirements as participants search for best execution across more liquidity venues. The SunGard Transaction Network (STN) connects 200 brokers with 1,600 asset managers via a single FIX connection. STN will also offer analytic tools and reports to help firms refine their execution policies.
MiFID: Managed Data Services
A greater range of execution venues along with stricter 5-year record keeping requirements will prompt new data management challenges. SunGard referencePoint offers solutions to these challenges in a secure hosted environment. SunGard Availability Services offers uninterupted access to critical data.
MiFID: Private client asset managers & stockbrokers
Private banks, private client asset managers & stockbrokers will have to adapt to a post-MiFID world. The speed with which they do so will be a competitive advantage. APSYS has been working with APCIMS to help its customers get ready, focusing on client classification, trade/transaction reporting and best execution processes.
MiFID: Back-Office
SunGard's back-office systems: GMI; Invest One; GP3; V3; Adaptiv Operations; Phase3; have been monitoring MiFID and discussing with their respective customers the best ways to get ready for MiFID implementation. Until the Directive is enshrined in national regulation back office systems have to wait to understand the full requirements, but SunGard is getting ready.
MiFID: Implementation and Consulting
SunGard Consulting Services ties together our broad product expertise with implementation consulting and project management services.