London
23 February 2017
Reporter: Stephanie Palmer

NEX invests in MiFID II research platform


Cloud-based institutional research marketplace RSRCHXchange has secured investment from Euclid Opportunities, NEX Group’s financial technology investment business.

Terms of the investment have not been disclosed.

RSRCHXchange launched its RSRCHX research marketplace and workflow solution for the second Markets in Financial Instruments Directive (MiFID II), in 2014, ahead of the new directive that will come into effect in January 2018.

Under MiFID II, investment research must be bespoke to each institution, and investment firms must pay for research with their own funds, or through a separate designated account, which is charged to the client. Research fees also have to be separated from execution and trading fees.

The new rules are designed to improve transparency, and to stop research costs being unfairly passed on to clients.

The RSRCHX platform is a purpose-built solution, allowing asset managers to purchase and monitor research in one place, tracking firm-wide use and allowing them to only pay for what they use.

Michael McFadgen, managing director at Euclid Opportunities, said: “MiFID II research unbundling is a key challenge for our clients and the wider market in 2017.”

“RSRCHXchange is bringing next-generation technology to solve a complex regulatory challenge while also allowing both providers and consumers of research to extract greater value from content. The business has made amazing progress thus far and we’re delighted to bring our capital, operational expertise, and networks to help scale the business globally.”

Jeremy Davies, co-founder of RSRCHXchange, said: “The asset management community is on the cusp of unprecedented change as research and execution costs unbundle in less than 12 months when the MiFID II requirements come into effect.”

He added: “Euclid Opportunities’s investment in RSRCHXchange has come at a pivotal moment in time and will enable us to further develop the RSRCHX platform for the benefit of both asset managers and research providers.”

RSRCHXchange co-founder Vicky Sanders said: “Their investment is testament to our business model and comes at a time of great momentum for our RSRCHX platform. We look forward to Euclid’s support well beyond the implementation of MiFID II, to achieve our growth ambitions for the future.”

Through Euclid Opportunities, NEX invests in financial technology companies that are working to develop the capital markets.

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