The FIX Trading Community And MMT
By Jim Kaye, Co-Chair of the FIX Trading Community Global Steering Committee and Director of Execution Services, Bank of America Merrill Lynch
What are the principal consequences of MMT becoming a FIX standard?
There were two main drivers for this from an MMT perspective. One was to provide the opportunity to leverage the FIX Trading Community’s broad member base to assist with the ongoing development and adoption of the standard. The other was to move the MMT standard under the FPL Trust. This already covers the FIX Protocol and other FIX standards and basically ensures that the MMT standard will remain open and free to use for the entire industry.
How will this development feed into post-trade efforts around the consolidated tape?
It solves a long standing issue regarding the standardisation of classification of trade data. This issue has historically made data consolidation difficult and increased the likelihood that different implementations of a consolidated tape would come up with different data. This is clearly just one piece of the jigsaw but an important piece nevertheless.
Are there any implications for pre-trade as well?
We’ve discussed pre-trade and it’s certainly an area for consideration. Though the MMT in its current form is very much geared towards post-trade data, i.e. the classification of trades, there is an interest in similarly normalising the classification of quotes pre-trade. Aside from that though, there is significant overlap in terms of the business usage guidelines which are an important part of the standard. Many of the discussions and decisions around those in the post-trade area are relevant to the pre-trade space and we intend to leverage that as part of any pre-trade work.