US Buy-Side Impacted By MiFID II Almost Doubles from Last Year

This article first appeared in The Trade

The amount of firms in the US to be impacted by European regulation MiFID II has increased significantly over the course of a year.

A report into US equity trading carried out by TABB Group found 66% of buy-side firms will be impacted by MiFID II.

This figure increased from last year when only 38% stated they would be directly affected by the European regulation.

Principal and head of equities research at TABB Sayena Mostowfi and research analyst Valerie Bogard, explained the “global nature of operations, client demand and competitive forces” are likely causes of the increase.

The co-authors added: “In conjunction with a shift in regulatory focus from exchanges and broker-dealers to buy-side institutions, a European regulation is set to fundamentally transform buy-side businesses in the U.S.”

TABB Group also found 45% of survey participants stated technology changes as their top initiative in 2016.

MiFID II regulation has “served as a catalyst for further data collection and operational transparency” and buy-side firms are using technology to prove best execution and reduce costs.

Mostowfi concluded: “As the buy-side improves measurement processes and explores the ability of new technology to collect, measure and analyse their broker lists, it is likely that existing broker lists will become even more concentrated.”

Related articles

  1. The strategies are the second launch of Northern Trust Asset Management’s ETF offerings in Europe.

  2. Daily Email Feature

    Digital Assets on the Buy Side

    With Thejas Nalval, Co-Founder and Chief Investment Officer, Parataxis Capital

  3. From The Markets

    Investors Back EU CSRD

    Corporate Sustainability Reporting Directive elevates sustainability information to same level as financial.

  4. Essentia analyses data to create behavorial “nudges” for fund managers' investment decisions.

  5. Corporate Bond Trading on the Rise

    With Adam Conn, Head of Trading, Baillie Gifford