Fintech company Red Deer and Convergex’s Westminster RPA are working together to provide an end-to-end MiFID II solution for the asset management industry.
Westminster Research Associates is a broker-dealer specialising in providing full-service custodial aggregation solutions and access to an extensive network of independent research to the institutional investment community. Convergex is an agency-focused global brokerage and trading related services provider.
Together, Red Deer and Westminster RPA will enable clients of both companies to benefit from a research valuation and payments process that allows asset managers to remove any scope for conflict by valuing and paying for research independently from trade execution.
The research valuation and payments solution will meet the MiFID II regulatory requirements around research consumption and valuation, whilst at the same time enhancing operational efficiencies.
Luke Oubridge, CEO of Red Deer, says: “Our relationship with Westminster RPA will serve as a great asset to clients by offering the research payment functionality needed to deliver an end-to-end solution with true operational efficiencies, whilst at the same time ensuring firms stay on the right side of the regulation. We’ve taken a ‘front office first’ approach to our MiFID II research consumption and valuation solution – one that enables Portfolio Managers to track and value research at the point of consumption without interrupting their daily process, whilst still delivering the granularity and control the compliance team needs to ensure they are in line with regulatory requirements. Pricing and valuing research ahead of the January 2018 deadline is still a major challenge for the buy-side, so Red Deer is assisting asset managers to test budgets and broker models, to get ahead of the regulation and prepare for the go-live date.”
“Westminster RPA is focused on building a strong presence throughout the UK and Europe and this joint service with Red Deer is further testament to our commitment to provide end-to-end solutions for our clients,” says Chris Tiscornia (pictured), CEO of Westminster Research Associates. “Westminster RPA is a full-service model that handles a firm’s operations while minimising administrative efforts and costs.”
To enable firms to address the MiFID II regulations around inducements and research valuation, Red Deer aggregates all independent and street research, including email, calls, and corporate access events, and automatically classifies it as research or commentary using Natural Language Processing (NLP). It also provides full consumption and valuation metrics such as ratings, read time and signals generated, and tracks contributions from hard and soft budgets, with alerting to ensure budgetary thresholds are maintained.
Westminster RPA provides tools to manage research budgets, allocate payments against these budgets and generate MiFID II compliant reports for internal control, regulators and clients. Clients can also import budgets, payment information and trade details from external sources, including Red Deer and other budgeting and research valuation platforms.
