UBS Investment Bank has launched a real-time transaction cost analysis (TCA) service to help European clients achieve best execution.
Available via UBS Fusion, the firm’s equity trading analytics platform, the new service provides buy-side traders with live, continuous analysis of their orders during execution.
Real-time TCA is part of UBS’s Direct Execution electronic trading suite, which also includes trading and analytical tools such as pre-trade transaction cost analysis for single stock and portfolio trading, a suite of in-market tools including trading alerts, and downloadable reports and analysis tools.
“Via Fusion, clients can see where they are getting fills across different venues and react accordingly in real time,” Mark Goodman, managing director, Direct Execution (Equities), UBS, told theTRADEnews.com. “A client might initially instruct our TAP algorithm to take good prices wherever it can find them, but then decide to take a more patient approach and reduce participation in displayed markets in favour of dark liquidity.”
Historically, post-trade analysis has been sent to clients at the end of the trading session, day or month to help evaluate the effectiveness of trading tools and strategies. UBS said real-time TCA will give clients the opportunity to monitor progress and affect the order’s outcome. UBS Fusion’s real-time analytics continuously update while the orders are live – allowing clients to monitor performance across all venues, including exchanges and alternative pools of liquidity.
Goodman said clients were increasingly demanding improved execution performance across Europe’s new trading venues. “There’s been a natural progression in client requirements as their comfort levels with the post-MiFID environment has increased. Clients first were focused on MiFID compliance, then connectivity to multiple trading venues and now they’re looking to monitor and improve the quality of their fills,” he said.
Phil Allison, head of European equities trading execution at UBS, said:
“Since post-trade analysis is, by definition, the assessment of past performance, it cannot add optimal value to dynamic trading decisions. Giving our clients real-time TCA while their orders are still active provides a valuable decision-making tool for traders.”
Real-time TCA was launched to clients in the US in September 2008.