WS1

WS1

Tuesday, September 3, 2013

HOW DO WE IMPROVE BUY-SIDE TRADE AFFIRMATION RATES? – UNITED STATES



The current affirmation rate for institutional trades is about 80% in the US. In this day of no-or low touch trading and automation this is an anomaly and delays trade life-cycle process improvements. In addition it may be contributing to higher costs.

It’s crucial that the industry, both buy-side and sell-side participants, address the issues that are blocking a 100% affirmation rate. This will deliver control and cost benefits to all participants and make the process safer and timely settlement predictable.  

What drives the Buy-side lack of interest in proactively participating in a process that ensures that the trade will settle as expected and at the same time adds a level of safety to the process? This raises certain questions:

Why isn’t the Buy-side motivated to participate in this process?

Do they understand the importance of the confirmation / affirmation process?

What needs to be done to achieve 100% affirmation by T+!?