17 January 2018
visit www.avoka.com

Transparency and price discovery suffering under MiFID - CFA

07 December 2009  |  9201 views  |  0 Stock market quotes

Fragmentation in European equity markets has had little impact on price formation, but transparency and trade reporting have suffered under the Markets in Financial Instruments Directive (MiFID), according to a study conducted by investment body the CFA Institute.

The CFA syas it finds "no empirical evidence" to suggest market fragmentation has had any material impact on the quality of the price formation process for equities traded under the MiFID regime.

Instead, the CFA says a poll of 962 investor members finds concerns centring on the difficulty in obtaining a complete and clear picture of market prices.

Seventy percent of survey respondents conclude that dark pools are problematic for price discovery, while 68% agree that market fragmentation has created difficulties in trade reporting obligations.

The CFA says the results support calls for the creation of a consolidated tape for quote and trade data for European equity markets.

Rhodri Preece, CFA, director, capital markets policy at the CFA, says: "Our study suggests that...fair and complete access to market prices remains a concern. It also highlights the difficulties in post-trade reporting in the fragmented marketplace. If these concerns are not addressed it could ultimately disadvantage large numbers of end-investors within the EU and conflict with the objectives of a fair and efficient market".

Charles Cronin, CFA, head of the CFA Institute Centre for Europe, Middle East, and Africa (EMEA), says the study is timely, with the MiFID review scheduled for early next year.

"A consolidated system or tape for pricing information would not only improve the quality of data for all stakeholders but also provide a level playing field for participants and help to facilitate best execution," he says.

Read the full report:» Download the document now 2.9 mb (PDF File)

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

LSE tech breakdown re-ignites calls for consolidated tape

LSE tech breakdown re-ignites calls for consolidated tape

19 October 2009  |  6183 views  |  0 comments
EU's MiFID review to look at dark pools

EU's MiFID review to look at dark pools

21 September 2009  |  11802 views  |  0 comments
MiFID helps cut share trading costs - study

MiFID helps cut share trading costs - study

17 July 2009  |  7738 views  |  0 comments
Europe braces for MiFID II as regulators assess market impact

Europe braces for MiFID II as regulators assess market impact

10 June 2009  |  11821 views  |  0 comments
Thomson Reuters launches consolidated tape

Thomson Reuters launches consolidated tape

19 January 2009  |  9900 views  |  0 comments
Instinet execution data shows 'MTF effect' on European share trading

Instinet execution data shows 'MTF effect' on European share trading

10 December 2008  |  9995 views  |  0 comments
Markit releases MiFID fragmentation analysis

Markit releases MiFID fragmentation analysis

04 December 2008  |  10304 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
visit www.niceactimize.comvisit www.vasco.comvisit www.niceactimize.com

Top topics

Most viewed Most shared
Buffett rubbishes cryptocurrencies; South Korea preps exchange crackdownBuffett rubbishes cryptocurrencies; South...
11560 views comments | 15 tweets | 17 linkedin
BNP Paribas Asset Management completes fund transaction blockchain testBNP Paribas Asset Management completes fun...
10169 views comments | 14 tweets | 33 linkedin
Europe begins Open Banking era in subdued styleEurope begins Open Banking era in subdued...
9620 views comments | 32 tweets | 34 linkedin
Crypto mining threatened by power capacity concernsCrypto mining threatened by power capacity...
9483 views comments | 17 tweets | 18 linkedin
Exchanges call for global fintech standardsExchanges call for global fintech standard...
9205 views comments | 17 tweets | 13 linkedin

Featured job

Competitive base + commission (double OTE)
London, UK

Find your next job