|iShares Launches Consolidated ETF Tape|
|May 28, 2012 18:11 (CET)|
The possibility of a consolidated tape covering European ETF trades moved a step closer to reality today with the launch of a consolidated view for European iShares products.
More comprehensive ETF reporting has been on regulators’ agendas for some time, and there have been calls for a consolidated tape from many sectors of the industry. In an interview with IndexUniverse.eu published last week, Laurie Pinto, chief executive of NSBO, said a consolidated tape would help investors to monitor best execution and increase the level of transparency in the marketplace.
The iShares consolidated view will allow investors to more easily see the best bid/offer prices for its products, as well as determine where liquidity exists.
It has developed the service in partnership with Bloomberg, and will use the data provider’s European composite tickers, which aggregate volume and trading data for reported over-the-counter (OTC) and exchange-traded iShares ETFs from 22 venues across the continent.
Investors will now use a much smaller number of tickers to get data on the iShares range, with information that was spread over almost 1,400 tickers cut down to 517.
The way it now works is that a single ticker will provide information from all European exchanges on each currency.
For example, the iShares FTSE 100 is traded on five European exchanges in sterling and four in euros.
In the past, an investor would have needed to look up each of these to work out the total volume traded in each currency. However, there will now be just one consolidated ticker for sterling and one for euros.
While the consolidated view will undoubtedly make it easier to determine the level of trading of Europe’s largest ETF issuer, it won’t be able to capture non-reported OTC trades.
Not all OTC trades have to be reported under current regulations. Some changes to the way OTC trades are reported are expected under MiFID II—the latest proposals would see ETF trades treated like equity trades for reporting purposes—but these are not likely to come into effect until 2014.