Big xyt has added a new function to its Liquidity Cockpit dashboard, Liquidity Type.
According to big xyt, the updates on the dashboard will provide greater transparency on over-the-counter (OTC) equities activity, including systematic internaliser (SI) transactions.
Liquidity Type’s new capabilities enable clients using Liquidity Cockpit to distinguish between total addressable and non-addressable activity for OTC and SI transactions.
Big xyt said the new Liquidity Cockpit functionality shows that less than 50 percent of the total SI volume reported is addressable.
The Liquidity Cockpit analytics normalise liquidity and offers the user an interactive dashboard to understand liquidity across time, venues, regions, a range of new condition codes and individual securities.
The latest functionality, has been developed in response to a concerns among practitioners for the identification of addressable activity within OTC and SI trade reports.
Big xyt said it has become apparent that a high proportion of activity labelled as SI is non-addressable, such as technical trades.
This is also evidence that SI transactions are being reported twice, as participants continue to become accustomed to the second Markets in Financial Instruments Directive (MiFID II) regime.
Robin Mess, CEO at Big xyt, said: “With the additional quantity of prices and trades being reported as OTC and by SIs, firms need to be able to identify where prices are really addressable and accessible to them.”
Mess added: “Being responsive to our clients is very important to the team here at big xyt and I am delighted that we have been able to quickly deliver this solution to an unforeseen complication of MiFID II implementation.”
Tim Cave, an equities analyst for TABB Group in London, commented: “It has become clear at the outset of MiFID II that lots of different OTC activity is being reported under the SI flag, making it difficult to decipher what is addressable liquidity and what isn’t.”
He added “Anything that provides greater clarity in this area helps both practitioners and regulators gain a better understanding of where true liquidity resides in Europe's equity market and that can only be a good thing for the industry as a whole."
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