Bats Europe, the continent’s largest stock exchange operator, has begun offering testing and access to its platform, garnering the use of its MiFID II compliant process for order record keeping. Consequently, Bats has moved ahead with its testing to promote harmonization ahead of the ultimate passage of MiFID II legislation.
In addition to the testing, Bats has also undergone a cascade of enhancements and upgrades to its platform to streamline its algorithmic testing capabilities. This specifically encompasses an order record keeping requirement known as RTS 24, which stipulates that trading groups must record data streams throughout the duration of the day.
Bats’ solution is important as it helps mitigate record keeping requirements, thereby eliminating sensitive data flow being exposed through core trading modules. Additionally this helps reduce latency concerns that can crop up given large message sizes.
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Practice Makes Perfect
Much time and effort has gone into Bats’ implementation of its solutions testing, having consulted extensively with market participants and other trading venues to engineer a solution that could ultimately be adopted as an industry bellwether standard.
According to David Howson, Chief Operating Officer (COO) of Bats Europe, in a recent statement on the testing: “In preparation for MiFID II, we’ve been working closely with the industry to standardise the manner in which investment firms supply required data to our venues.”
“We believe our approach to the record-keeping requirements in MiFID II is a low-impact, secure method and we encourage other venues to adopt this approach to create harmonisation across the industry,” he added.
“The RTS 24 requirements have been one of the most significant areas of development for Bats as it relates to MiFID II. We have put a lot of time and consideration into the development of this approach and we’re pleased to roll-out testing of the solution, enabling our participants to test the process for more than 16 months prior to MiFID II coming into effect on 3 January 2018,” he reiterated.