JP MORGAN AND CITADEL ADOPT truePTS POST TRADE SOLUTION.
The automated trade processing platform for derivatives, truePTS, has generated its first buyside trades with JP Morgan and Citadel.
truePTS aims to offer a lower cost digital alternative to legacy confirmation providers. With electronic execution becoming standard, the need for physical confirmation has been replaced by demand for automated, real-time matching and front-to-back trade flows. Its ‘no-touch’ processing environment claims to process trades at greater speed than legacy platforms, enabling auto-matching, direct clearing and removing manual steps that represent one of the largest sources of errors, revisions and operational risks.
The platform uses innovative technologies such as robotics and artificial intelligence (AI) for post-trade affirmation and matching, as well as facilitating confirmation and reporting workflows, incorporated into trade repositories, central counterparties, and buyside platforms. Its matching and validation engine determines an instrument’s eligibility reporting requirements based on liquidity and size, which are continuously updated to support the latest regulatory revisions
This could be beneficial for voice trades, lowering costs and risks while increasing operational efficiency. Under MiFID II rules, voice trades are obliged to be passed to a clearinghouse within 10 minutes of execution and reported within 15 minutes.
The system also synchronises parts of the processing chain that had not previously been linked up, such as matching new and terminated trades in compression activities.
“In recent years, derivatives trading has migrated to electronic venues which has significantly improved execution workflow, but post-trade processing for many of these instruments still relies on legacy technology resulting in inefficiencies downstream,” said Dan Dufresne, Global Treasurer at Citadel. “We are excited about the truePTS offering, which will improve post-trade efficiency, decrease costs, and reduce operational risk.”
“New regulatory requirements have shifted responsibilities and fees once paid by the banks to the buy-side,” said Zohar Hod, CEO of truePTS. “We will be the catalyst that provides transparency, mitigation of needed resources, and lower costs for our clients by leveraging the most progressive technology to automate workflows and comply with regulatory change.”
Commenting on the truePTS solution, Dan Dufresne, global treasurer at Citadel, says: “In recent years, derivatives trading has migrated to electronic venues, which has significantly improved execution workflow, but post-trade processing for many of these instruments still relies on legacy technology resulting in inefficiencies downstream. The truePTS offering will improve post-trade efficiency, decrease costs, and reduce operational risk.”
The buyside launch follows the announcement of strategic relationships with JP Morgan and Citi in December 2017. Hod says there are more than a dozen large dealers coming onboard and “that the more people on the network, the more efficient the post-trade environment will be.”
“This is an exciting development in the post-trade industry,” said Kieran Hanrahan, Global Head of Markets Middle Office at JP Morgan. “Buyside firms’ participation will be critical to the scalability of the truePTS platform.”