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Best Execution is big challenge to all...

Best execution is one of the most critical challenges in trade order management, as we all know. It involves a lot of steps including prioritisation of factors, analysis and selection of execution venues, linkage to execution venues, creation of best execution policy, execution of orders, periodic review of factors and venues. The challenge here is that best execution policies and order routing algorithms vary vastly from firm to firm, often best execution policies are unstructured content that guide business decisions to be made. Firms are now struggling to formalise these policies and incorporate the rules into OMS. Also, in their bid to achieve best execution, firms will need to carefully monitor data latency in addition to price and ask themselves whether they should upgrade their systems to cope with the heightened pressure for SPEED....
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A Finextra member
A Finextra member 18 October, 2007, 06:51Be the first to give this comment the thumbs up 0 likes One of the important aspect of periodic review of the bestEx policy is looking at the performance of the venues you have incorporated in the policy. In the absence of a 'standard' format in which the venues need to publish the statistics regarding their execution performance (on the lines of what SEC prescribed by Dash-5 and Dash-6 reports), it will be a challenge to compare venues. I mean nobody will publish statistics that show them in bad light!
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