February 11-15, 2002
World Federation of Exchanges
Tom Krantz (Secretary General), Peter Clifford (Director)
FISD has established a strong working relationship with the
World Federation of Exchanges (WFE,
formerly FIBV). WFE views us as an effective and neutral forum for market data
issues. Market data commercial and content activities have become an ongoing
component of the WFE agenda. WFE will continue to include FISD as a regular
participant in the agenda of their meetings. WFE is interested in working with
FISD on the development and promulgation of “best practice recommendations” on
market data management issues and strongly supports our
MDDL and data
transparency efforts.
Market Data Definition Language (MDDL)
Bloomberg, Cicada, Deutsche Bank, Fidelity Investments, FT
Interactive, Goldman Sachs, ILX, London Market Systems, London
Stock Exchange, Merrill Lynch, Moneyline Telerate, Reuters,
Thomson Financial, Telekurs Financial
This was a working meeting to begin the process of defining the taxonomy of
debt/fixed income instruments (the next product area for MDDL). FISD has
produced and posted a
functional
coverage matrix (a multi-dimensional view of the data model) as the
mechanism to define this product area. The
matrix was the primary reference document for the meeting. The meeting was
productive and we made significant progress toward defining both the data
model and the terminology for debt instruments.
FISD and
SWIFT have agreed to integrate MDDL terms into the
ISO 15022
data dictionary. This is a significant accomplishment – the goal being to make
the data dictionary the global market data repository for the industry. During
the meeting FISD established a mechanism to work with the
Bond
Market Association and
FIX to
coordinate efforts associated with defining this domain. MDDL terminology will
also be mapped to ISO standard Classification of Financial Instruments (CFI)
codes as part of this process.
ANNA Service Bureau Contract Discussions
Claire Pons (Thomson Financial), Kelvin Bossey (Financial
Times)
Market data vendors and institutional users are looking to the
ANNA
Service Bureau (ASB) to assist with the licensing, redistribution,
customer support and contractual issues associated with access to and use of
security identification numbers (ISIN). On request of the ASB, FISD has worked
with the industry to draft a Data License Agreement for ASB consideration. The
purpose of this meeting was to finalize the proposed Agreement and to outline
the strategy for submitting it to the ASB.
This discussion is particularly important in that it will define the
business model associated with the acquisition, redistribution and use of
primary identifiers. The overall objective is the adoption of commercial terms
and conditions that support global commerce and help the industry meet the
objectives of T+1 and straight through processing. The outcome of this
activity has significant implications to the future role of the ASB as a
utility for security identification.
Market Data Business Issues
BP Oil International, CSFB, Charteris, Euronext LIFFE,
Fidelity, Harco Technology, HSBC, Jordan & Jordan, JS Market Data,
Lazard, London Market Systems, London Stock Exchange, Market Data
Services Limited, Moneyline Telerate, Nasdaq, Reuters, Rights
Management, Risk Waters Group, Screen Consultants, Spearhead &
Partners, Standard & Poor’s Comstock, Thomson Financial
This working meeting was organized into two parts. The first was designed
to review and evaluate FISD’s efforts related to billing and reporting. The
second was designed to re-initiate the Market Data Policy Working Group on
issues associated with redistribution, unit of count and data usage.
Most of the attendees were there to talk about billing-related issues. We
distributed a status report in advance of the meeting and summarized the
results of our discussions at the outset. There were no additional surprises
as a result of the meeting and much of our initial conclusions were validated.
FISD will write up our analysis and recommendation by the March deadline. In a
nutshell – and moving from simple to hard …
- Users want electronic bills regardless of format.
- Standardizing billing/reporting data elements (i.e. the XML standard for
billing) is supported by all segments.
- All segments support customer identification standards. Using ISO
standard Bank Identifier Codes (BIC) looks promising. SWIFT is the
registration authority for BIC. We’ve had discussions with SWIFT and they
believe it could be functional.
- Normalizing product naming conventions and assigning a standard product
identification code is critical to user firms. The concept of a standard
product catalogue - a prerequisite to assigning product codes – is being
resisted by vendors (for a variety of reasons) and is not well understood by
the functional market data managers.
The market data policy issues are the domain of senior market data managers
within vendor (redistributors) and exchange constituencies. No surprises.
Vendors want more flexibility to use data and administrative
consistency/simplicity. Exchanges are concerned about the commercial
implications. The big three issues relate to redistribution, units of count
and data usage (i.e. rights to use and rights to derive data).
Business Entity Identifiers
Clearstream Banking, London Stock Exchange, Merrill Lynch,
SWIFT, Thomson Financial
This working meeting focused on security identification requirements in the
post-GIAM era and the role of the ANNA Service Bureau as the conduit for
aggregating, linking and disseminating this data. The essence of the security
identification is issue fairly easy to conceptualize. The security identifiers
– and their linkages - need to be precise and unique to facilitate automation.
The two critical questions to address with symbology are:
- What product did you sell/buy? This is what we have been working on with
ISIN, official place of listing, place of registration and other data
elements required for product identification.
- Who did you sell it to? This includes identification of all the
counter-parties and business entities involved in the sale.
The industry has been very appreciative of our efforts and accomplishments
with respect to ISIN and the ANNA Service Bureau (question number 1). They are
now asking us to help facilitate a solution to business entity identification
(question number 2). This meeting was designed to define the issue and
determine what FISD (probably in partnership with SWIFT and the ASB) can do to
help.
The issue of counter-party identification is fundamentally a risk
management problem that can be addressed by standardizing fund, issuer and
business entity identification. The firms suffer from the problem. They want
to buy the solutions from the vendors. They want FISD to help set the
infrastructure for getting access to the data, creating linkages and
establishing the symbology standards for identification.
Next steps are to write the paper (defining the issue and outlining a
potential path forward). The firms will ensure that the heads of risk
management endorse the activity. We are fairly confident the vendors will be
ecstatic. Once that occurs, we can approach the standards bodies, ASB and
SWIFT (and others) with the business case to work toward fixing this
significant problem.
