SteelEye launches new Order Book Replay as regulators crack down on market abuse

Rick Steves

“As regulators crack down on market abuse, SteelEye’s market replay provides a comprehensive yet accessible visual representation of a firms’ order and trade activity against the full order book so they can more effectively monitor for irregular behaviors.”

SteelEye has launched its new Order Book Replay service designed to facilitate more precise and rigorous market abuse surveillance so that organizations can playback a trading session and more thoroughly analyze market movements.

The market replay solution, which is fully incorporated and has gone live for a range of clients, allows compliance teams to play, pause, rewind, fast forward, slow down and speed up order book activity to gain a full understanding of what has taken place.

The solution visually showcases the overall balance of the book against market price levels and spreads. It also highlights where trading activity might be indicative of market abuse behaviors like spoofing and layering.

Most firms have limited retrospective view of their trading operations

Matt Storey, Chief Product Officer at SteelEye, commented: “Today, most firms have a limited retrospective view of their trading operations which restricts their ability to identify opportunities, risks, and compliance threats. As regulators crack down on market abuse, SteelEye’s market replay provides a comprehensive yet accessible visual representation of a firms’ order and trade activity against the full order book so they can more effectively monitor for irregular behaviors.”

Matt Smith, Chief Executive Officer at SteelEye, said: “There have been many recent, high-profile examples of firms being reprimanded and fined by regulators for market abuse. These events act as stark reminders of the need to identify, investigate, mitigate, and report on potential instances of market manipulation. With SteelEye’s comprehensive Order Book Replay firms can more effectively oversee their trading operations to better detect market manipulation, not to mention get data insight that can power enhanced decision making and trading performance.”

SteelEye has recently launched an automated Three-Way Reconciliation solution to tackle MiFIR transaction reporting issues. The compliance technology and data analytics firm has designed the solution to help firms fulfill their reconciliation requirements, validate their MiFIR reporting data and easily address errors – ensuring that reporting has been done completely and accurately.

The industry has struggled with data integrity issues since MiFID II came into effect, even though complete and accurate reporting data is critical for regulators to maintain fair and orderly markets.

Many firms have faced difficulties with the reconciliation requirement (under Article 13 (3) and (4) of RTS 22), which aims to enhance reporting quality by making firms validate that the data they have reported matches what was received by the National Competent Authority (NCA) (or Approved Reporting Mechanism/Venue where the NCA doesn’t provide samples).

Some firms end up with error prone and manual validation processes and others have disregarded the requirement entirely.

SteelEye aims to improve reporting completeness and accuracy as regulators in the UK and EU are intensifying their enforcement action.

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