"Best Execution: the State of Play", the third in a series of research reports from the London based consultancy, involved canvassing over 70 buyside, sellside and technology vendors to deliver a review of the different perspectives on best execution. The work dispels traditional assumptions surrounding best execution, and re-positions these in today's context. It is published in association with Best Execution magazine.

GreySpark's research shows that for the buyside, the main emphasis is on trade price. This is in contrast to the sellside view, where low latency and access to liquidity are considered most important. For technology providers, the research shows that access to liquidity is considered the main focus for best execution.

The research was based on the industry experience of GreySpark consultants, coupled with buyside, sellside and technology provider face-to-face interviews. Industry survey data and a review of technology providers with and without Transaction Cost Analysis (TCA) offerings further the analysis. It revealed the following key results:

• 67% of buyside respondents said that it is price that indicates best execution; 64% stated an overall good relationship with their broker is a key enabler for the provision of best execution.

• 69% of sellside respondents see fulfilling client orders according to instructions as the main focus for achieving best execution; 94% see low latency and access to liquidity as their priority in achieving this

• 57% of technology providers maintain further regulations are required around the subject of execution quality

Increased regulation and the concerns voiced by market participants featured prominently in the report, with regulators across the globe continuing to put pressure on the industry to refine their best execution policies. As one interviewee, David Morgan, Marketing Director, Global Trading, SunGard, commented: "The market structure and risk management impacts of the on-going regulatory changes are important drivers for our product development. Costs of delivering best execution in fragmented markets can be high: a key goal for SunGard is to help customers contain these costs, in particular through the use of managed services (or SaaS)."

The report also reviews the various tools that are available for measuring best execution; in particular, TCA tools. GreySpark reveals that 98% of large and 88% of medium-sized buy-side firms have already adopted a form of TCA, with a further 10% planning to use a TCA solution within the next three years. Ben Wood, Head of Sales - Equities - Europe at FlexTrade, a provider of multi-asset algorithmic trading systems, commented: "Of course we will see a further development of TCA over the next few years. At the moment browser based real time TCA is on the rise and available through certain EMS's. In two years we will see more multi-asset TCA tools become available."

"While many brokers claim to provide best execution, the real provision of this is to oblige not to take unfair advantage of having better market information" said Frederic Ponzo, Managing Partner, GreySpark Partners. "We hope that this report will show how various firms on the buy-side view best execution, and what tools are available to the market as a whole to help measure best execution and TCA more accurately".