Buy-side traders can for the first time use and monitor disparate broker algo strategies using normalised parameters after an upgrade of agency broker Instinet’s execution management system (EMS).
The firm’s Newport EMS has added OneTicket functionality, which allows the management of algo parameters using a universal standard, thereby simplifying the differences in the way algo settings are presented by brokers.
Speaking to theTRADEnews.com, Tom Whelan, head of US product sales for Instinet, said the new function, part of the Newport 3.15 rollout, aimed to reverse the relationship between the buy- and sell-side, giving the former better access to functionality that will help improve execution.
“The sell-side has done a good job of innovating on the algo front, but an unfortunate side-effect has been that the buy-side is now inundated with various parameter terminologies, creating operational risk. OneTicket streamlines that and lets the buy-side dictate to the sell-side what they want,” Whelan said.
Algo factors such as urgency and levels of aggression will be measured on a 1-10 scale, improving execution and reducing time taken to select algo strategies.
“We worked with brokers to establish a normalised ticket, so users now interact with algo strategies from different brokers in a uniform manner,” Whelan said.
The EMS upgrade also introduces a function whereby a trader can benchmark performance and analytics from one symbol against that of another – for instance two related stocks, or a depositary receipt and its underlying stock, further streamlining a routine trading practice.
Newport now also supports crossing for US-listed options for single- and multi-leg orders and futures trading functionality has been extended to Australia, Hong Kong, Japan, Korea and Singapore.