Following the MiFID proposals, Heather McKenzie looks at the challenges and costs associated with introducing a consolidated tape for European equities
According the European Commission’s review on MiFID, a European-wide consolidation of data should meet high quality standards, while being provided at a reasonable cost. A commercial consolidated tape solution could increase access to market data information, giving both efficiencies and cost benefits.
GreySpark maintains that consolidated tape is a good step toward increasing transparency in the market, but not without its challenges. The development of a consolidated tape will be fraught with issues around its commercials: how much it will cost for users and market data vendors, how these providers unbundle information, and how the data will be sold.
Further suggestions for an alternative solution to consolidated tape are raised. In the absence of this, deliverable standards on market data are key, such as similar formats, which will avoid duplication when market data vendors aggregate data.