Market Data Monopoly? - Part One
May 7, 2009
The provision of accurate and timely market data is truly the lifeblood of almost every financial services organisation worldwide. Every day these orgaisation rely on the latest stock prices, financial instrument attributes, corporate action events, rates and analytics in order to make trading decisions, reconcile their accounts and track their performance.
These requirements for a steady stream of vast quantities of data have give rise to a number of extremely successful market data organisations who collate their data from the exchanges and brokers and package it up so it can easily be consumed by banks, investment managers and anyone else who can afford to sign up for an account.
Two of the major players in the market data business are Bloomberg and Reuters. Their market data products are very similar and allow their clients to subscribe to market data feeds via several mechanisms, including ‘Pay-As-You-Go’ whereby you can make requests for information (eg prices and attributes) about a particular financial instrument (eg BHP Ordinary Shares) and they send back the details, for which you pay ‘Per Security’ - currently around $2(USD), depending on security tyep (Bond, Equity, Derivative, etc). Alternatively you can subscribe to entire segments of security data in a ‘batch’, for instance ‘Asian Equities’, and receive the entire universe of those securities daily. The choice of mechanism really depends on how many securities of a particular type the client needs data for and what the most cost effective mechanism is at the time. Read more
