Traiana, the infrastructure provider for trade lifecycle and risk management solutions that is part of CME Group, is looking to consume and normalize data from multiple swap providers into a single format in a move towards front-to-back automation of equity swaps lifecycle workflows.
Ryan Spencer, head of securities and business development at Traiana, told Markets Media that the firm been planning for the last few years to deliver a service that seeks to automate the equity swaps lifecycle workflows.
“Traiana has a large network of over 20 swap providers and 120 buy-side clients who check details on their trade, valuation, and payments data,” said Spencer. “We want to provide a market utility for front-to-back automation and increase efficiency, which will benefit the whole market, and particularly the reset process.”
The equity swaps markets currently has manual post-trade processes which are labor intensive and inefficient.
Spencer continued that in order to increase automation, Traiana will consume and normalize data from the multiple swap providers into a single format of clean data and run a daily comparison cycle for the financing and dividends values. Buy-side firms can then view all exceptions in one place.
Joanna Davies, global head of Traiana, said in a statement: “Until now, it has been extremely challenging for buy-side firms to sift through multiple swap provider reporting statements in various formats, across thousands of trades and positions per day to look for potential issues and work out exactly what has changed at the month-end reset."
Spencer explained that approximately 80% of month-end reset cash flow issues are related to financing and dividends values.
The first phase of centralizing and comparing the data has gone live. The second phase, which focuses on a dashboard for prioritization and grouping of breaks will go live in the fourth quarter of this year and the final phase is slated for the first quarter of 2020.
Spender added that the market also wants analytics and data on performance and trends which will be delivered in a future release.
“We are also reviewing other elements of the swap lifecycle events process including corporate actions, settlement netting and independent validation of prices for valuations that can be rolled out to meet demand,” he said.
