10.28.2011

Data Quality a Must-Have for Derivatives

10.28.2011
Terry Flanagan

Interdealer broker GFI Group provides independent trade data.

Participants in derivatives markets are in vital need of objective, independently-sourced data upon which to base their trading decisions.

As independent intermediaries in typically highly specialized markets, interdealer brokers are helping market participants derive hard to find, independent, and comprehensive real-time and historical data.

GFI Market Data, a unit of GFI Group, provides prices for both liquid and illiquid derivatives, spanning credit, energy and commodities, FX, equities, and interest rates.

“Banks and other consumers use our data for pre- and post-trade decisions, and for risk management,” Philip Winstone, global head of sales at GFI Market Data, told Markets Media. “The fact that we provide independent data is of critical importance. We are not manipulating the data in any way, but are sending it straight through.”

With brokerage operations in credit, equity, FX, energy and commodities, GFI is a major information hub for cash and derivative products.

“GFI is ideally positioned to provide capital markets with data that refers to actual executable and executed market prices and trade information, reflecting market entwinement rather than indications gleaned through consensus pricing,” said Winstone.

SunGard has added data from GFI Market Data to help enhance the quality of the data in SunGard’s FastVal, which provides independent valuation services. GFI will supply FX data to FastVal, to help customers of the service independently value a wider range of derivatives.

“GFI Market Data provides an independent view on the tradable market for FX options captured from our trading system GFI ForexMatch,” said Winstone.

Market participants can receive data from a dedicated real-time FX options feed delivered directly into GFI’s FENICS options pricing software, or directly onto their data distribution platform.

GFI’s implied volatility data for equities, FX options and interest rates s derived from a set of definitive, real market prices from major market makers.

“We provide value-added analytical data which uses algos developed by GFI to derive implied volatility,” said Winstone.

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