Mastering MiFID II: Market Structure & Pre- and Post-Trade Implications

Adapting the Sellside Execution Franchise

This report explores the different trading venues and counterparties under the updated Markets in Financial Instruments Directive (MiFID II), and it evaluates how existing sellside franchise business models must adapt in anticipation of the new mandates. The report also uses a decision-making framework for banks to evaluate which MiFID II venue type designation is most suitable for their business, and it assesses the technology necessary to support execution franchises under MiFID II’s new market structures.

The report argues that most bulge-bracket banks are already in possession of all the technology infrastructure needed to support existing trade execution franchises in line with the changes to the market structures for the equities, fixed income, FX and OTC derivatives asset classes that MiFID II will create.