State Street’s BestX Extends TCA Offering to Stock Markets

Clients of trading brokers can have their trades sent to BestX for independent post-trade transaction cost analysis

London-based FX analytics specialist BestX on Wednesday confirmed an extension of its transaction cost analysis (TCA) and market impact models to cover equity markets.

State Street’s best execution analytics platform said that the move is part of its ongoing aim to provide clients with a multi-asset TCA offering via its model that also covers FX and fixed income markets.

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Through several partnerships, clients of trading firms and brokers can have their trades sent automatically to BestX for independent post-trade transaction cost analysis, and also benefit from single sign-on integration.

The company also enables participants to implement and codify their best execution policy in the software and ensure those parameters are met using data from a broad range of sources.

“We responded to our clients’ needs by expanding BestX to provide a full multi-asset class offering. Whilst launching fixed income at the end of 2018, it quickly became clear that clients wanted one application to analyze all of their trading. The desire to consolidate data and vendors is a trend that we anticipate will accelerate over the next few years, and we needed to ensure we were positioned appropriately for this,” said BestX co-founder Pete Eggleston.

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BestX was founded by former Morgan Stanley executives in 2016 to offer post-trade transaction cost analysis for spot FX, forwards, NDFs, and FX swaps. Later in 2017, the best execution firm has gone live with pre-trade analysis functionality, as well as TCA for vanilla FX options.

BestX was acquired by State Street in 2018 as the US firm sought to better compete with rivals who rely on their own technology to provide clients with similar services. It was combined with the Boston-based firm’s offering to provide its customers with access to post-trade transaction cost analysis (TCA) when trading electronically with State Street.

The future of BestX is also promising due to increasing transparency requirements that define the conduct of all market participants, including the need for buy-siders to prove the best execution. For instance, MiFID II requires participants to achieve the best possible result for clients, taking into account a range of execution factors.

BestX has already signed several Wall Street giants, including Citadel Securities, JP Morgan, and HSBC, which are using the service for independent validation on execution quality for their own clients.

“BestX’s expansion into fixed income and equities is a testament to the team that in less than five years since inception, BestX now offers a full multi-asset class offering,” added Martine Bond, head of GlobalLink, State Street’s suite of e-trading platforms, technology, data and workflow solutions. “

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