The Financial Commission (FinaCom PLC) has issued execution certifications for some of its broker members as the industry-specific association attempts to reduce the number of execution-related disputes that occur before they progress into formal complaints.
The FinaCom’s assessments depend on VerifyMyTrade, a post-trade solution that has developed capabilities to accurately measure the execution quality of positions across the retail FX market.
The recently launched “value-added” service allows clients of the commission’s brokerage members to use its analysis tool to check whether their trades were fairly priced or not.
Verify My Trade consolidates price feeds from dozens of retail forex brokers to produce statistical box plots, which are a representation of the minimum, maximum and percentiles of the ticks received for every second of the day. This is illustrated by the image below.
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The Financial Commission said it has already audited and issued execution quality certifications to several retail brokers including Alpari, Forex Club, and AMarkets. To maintain their certified status, these brands are required to continuously submit their order execution data to the VMT analysis tool, which maps the execution price to the boxplot for that time of day in order to assess the effectiveness and quality of the broker’s execution.
Due to the price verification capabilities, brokers who implement the service would be able to settle price disputes internally, by inducing evidence on asset prices at any given time, from an impartial party.
And in case the client claims that he is consistently getting poor execution, the analysis results will facilitate handling execution-related trade disputes.
FinaCom’s statement further explains: “By clicking on the badge users will navigate to a dedicated webpage for each broker that will indicate the last time an audit was performed, how many orders were analyzed and whether the results satisfied the order execution standards established by VMT. All brokers who have not yet completed certification will be indicated as “Pending” in our Members section.”