New research jointly conducted by FINBOURNE Technology, Adamantia Advisory and Propellant Digital (supported by AFME, BVI and EFAMA) reveals a host of critical data that could undermine the efficiency and health of UK and EU bond markets Gaps were extracted. New post-trade transparency regime and integration tape come into force. The study revealed that the reliability of public information on bond trading is compromised by a significant number of errors, including missing fields and notable discrepancies.
Despite the importance of accurate data in fixed income markets, this analysis highlights some major issues. One of the most concerning findings is transactional data duplication. The study found that only ~11% of the 153 million bond transaction records analyzed were not duplicated. These overlaps arose from a complex process at certain electronic trading venues where data collection repeatedly captured both old and new trades. This requires significant “de-replication” efforts for parties seeking to perform detailed analysis of the data, complicating the task of obtaining a clear and accurate picture of market activity.
The study further revealed significant gaps in critical transactional and reference data fields. More than two-thirds of records from early 2024 were missing key currency information, and around 25% were missing transaction volume details. Additionally, there appear to be a number of required fields that are filled in using different interpretations of the appropriate format. This directly affects the reliability of financial reporting and hinders the decision-making process of institutional investors. The study also identified differences in the classification of reference databases that hinder market participants’ ability to accurately identify and manage their core data needs.
The findings are an important wake-up call for EU and UK bond investors. Unless these fundamental data inconsistencies are properly addressed, a revised post-trade transparency regime and the anticipated unified tape for UK and EU fixed income (which collects real-time data on fixed income trading from multiple sources) will not be implemented. (Initiatives designed to display Single platform – can be significantly compromised.
This detailed collaborative study highlights the timely need to strengthen data accuracy and completeness to protect and improve the future of fixed income markets. We urge industry stakeholders, regulators, and market participants to work together to address these data deficiencies to further promote stability and efficiency in fixed income markets.
UK and EU Bonds – Data Quality Report
said Thomas McHugh, CEO and co-founder of FINBOURNE Technology. From duplicating trades to missing critical information, numerous errors threaten not only market efficiency but also institutional investor confidence. As we move towards an EU integration tape for fixed income, it is imperative that industry stakeholders and regulators act quickly to address these data deficiencies. ”
Source: FINBOURNE Technology;
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