By Flora McFarlane.
Asset manager T. Rowe Price has announced that it will use the Intercontinental Exchange (ICE) Data Services’ Best Execution service for trade execution quality evaluation.
Looking to support best execution and enhance transaction cost analysis for fixed income securities, T. Rowe Price has chosen to leverage ICE’s service in response to evolving financial regulations and changes in the market to ensure high execution quality.
With new regulations coming in under MiFID II in January of next year, firms are looking to cover the obligations of regulatory change.
Best execution obligations under MiFID II will be extended to more asset classes, with firms now required to take ‘all sufficient steps’ to obtain the best possible result for clients when executing orders.
As a result, the levels of data and technology needed to support best execution are significantly higher, with proof needed not only for execution quality obtained, but also the quality and appropriateness of execution on an ex-ante and ex-post basis. Firms will also be required to report on the top five venues of execution, as well as summaries of outcomes received on those orders.
In a recent JWG survey, up to 90% of buy-side firms believe they are at significant risk of non-compliance for MIFID II, with 25% of firms not having finished analysing the requirements.
ICE’s Best Execution offers a trade-by-trade measurement of execution quality relative to comparable market transactions, providing T. Rowe Price with the ability to support compliance with global regulatory requirements and evaluate TCA across its trading desk in a compliant manner.
Alexander Sedgwick, vice president at T. Rowe Price said, “Best Execution offers effective tools, providing a quantitative solution that offers transparency, to monitor transaction quality and to respond to evolving global regulatory needs.”