Boston, April 4, 2012 – A new report from Aite Group examines key challenges faced globally by transaction cost analysis (TCA) providers and their users. It also briefly describes products and services that are provided by 16 leading TCA providers.
As electronic trading continues to be adopted across all major asset classes, TCA has become one of the core components of execution consulting among global broker-dealers. Still, TCA remains far from perfect, even in the well-traveled equities market. The overall quantity of data that must be analyzed across most asset classes has increased substantially, but the overall quality of that data has failed to follow suit. Even among TCA users that have managed to overcome data-quality issues, some are having a hard time truly understanding what TCA output represents; this makes it that much tougher for TCA practitioners to positively influence trading workflow. To address this issue, TCA providers have added advanced visualization techniques and consultative services that help make post-trade information useful in pre-trade and real-time analysis.
“Today, TCA vendors are attempting to provide more transparency around order-routing decisions, algorithm performance, peer group reviews, and growing support for multi-asset-class activities,” says Simmy Grewal, senior analyst with Aite Group and co-author of this report. “They are also entering into new asset classes to reflect their customers’ needs and are offering customized solutions that make their services more cost effective.”
TCA providers described in this report are Abel/Noser Corporation, Bloomberg Transaction Cost Analysis (BTCA), Credit Suisse, Elkins/McSherry, Fidessa, Instinet, Intelligent Financial Systems (IFS), Investment Technology Group (ITG), Knight, MarketAxess, Morgan Stanley, Portware, Quantitative Services Group (QSG)/Markit, Rosenblatt Securities, SunGard, and UBS.
This 46-page Impact Report contains 22 figures and eight tables. Clients of Aite Group’s Institutional Securities & Investments service can download the report.