The MiFID market infrastructure

The MiFID market infrastructure

Following the 2007-2009 financial crisis, G20 countries agreed to gradually implement regulations to steer trading away from less-regulated bilateral and OTC, towards public exchanges, electronic platforms and central counterparties. The goal was to reduce systemic risk and improve market transparency. Since then, several pieces of regulation were implemented in Europe: EMIR compels investment firms to trade derivatives on a trading platform when liquidity is sufficient, CRD IV requires additional capital for uncleared transactions, while MiFID I and II introduced new market infrastructures, and trading obligations. In the rest of this article, we focus on the changes brought in Europe by the two iterations of MiFID.

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The MiFID II impact on investment research

The MiFID II impact on investment research

In the last weeks before MiFID II goes live, the investment research industry is still adjusting to comply with the new rules designed to improve transparency and protect the investor. The new legislation covers a wide range of topics impacting the European financial system as of January 2018. One of the major constraints MiFID II introduces is a “no inducement” rule. It will require brokers to separate their execution and research offers, and investment firms will not be allowed to receive any research for free any more.

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