Improving trading data aggregation has been a major priority for EU policymakers, but there has been little progress
Improving trading data aggregation has been a major priority for EU policymakers, but there has been little progress © AP

Exchange traded fund distribution in Europe is being hindered because market data providers have shown little interest in creating a shared database of equity prices and trading volumes, market participants say.

The comments come as a new report by PwC finds that the EU’s Mifid II regime introduced in 2018 has had only a limited effect on improving transparency in market data in the region. The authors conclude that flaws in the availability, quality and consistency of trading data are impeding the distribution of ETFs in Europe.

Improving trading data aggregation has been a major priority for EU policymakers, who have called for the creation of a consolidated tape — a type of electronic system in which data feeds from different exchanges are banded together to create a summary across all markets.

However, attempts to create the tape have so far failed to get off the ground.

This article was previously published by Ignites Europe, a title owned by the FT Group.

Marie Coady, partner at PwC, said the lack of trading data standardisation meant retail investors did not have detailed insight into the overall liquidity of ETFs, making the products a less attractive proposition.

A 2018 industry initiative led by Bloomberg did introduce some aggregated trade reporting for ETFs, but the service is only available to institutional investors and still contains inconsistencies in data reporting, according to the PwC report.

“The tools available to institutional investors are much less available to retail investors,” said Jason Warr, head of ETFs and index investing for Europe, the Middle East and Africa at BlackRock.

Mr Warr said BlackRock would welcome more vendors sharing their data in a standardised format with asset managers as that could “accelerate retail adoption” of ETFs.

However, Ms Coady warned that standardisation risked “diluting” the commercial value of the data.

A spokesperson for the European Commission said it had been “consulting widely” to find commercial partners to help develop a consolidated tape.

People with knowledge of the discussions said the companies approached by Brussels include Nasdaq, IHS Markit, Appsbroker and Clarus Financial Technology.

An employee working for a large market data provider, who wished to remain anonymous, said: “All of the big data providers looked at creating a consolidated tape but the business case was just not really there.”

The data expert said a major challenge was the practicalities involved in aggregating data from more than 200 trading venues operating in Europe, which would create delays in the speed at which different clients were able to access the data.

“It might only be nanoseconds but that is important to our institutional customers so they will not pay a fee for this.”

While this so-called latency is unlikely to be an issue for retail investors, they lack the resources to fund a consolidated tape, leaving a question mark over “who is going to pay for all this infrastructure”, the expert added.

71%Proportion of European ETFs listed on two or more exchanges

Some 71 per cent of European ETFs are listed on two or more exchanges, according to the PwC report.

The PwC report also said regulators should pursue alignment in trading venue rules and establish specific arrangements for the clearing and settlement of ETFs.

Nasdaq and IHS Markit declined to comment. Bloomberg, Appsbroker and Clarus Financial Technology did not respond to a request for comment.

*Ignites Europe is a news service published by FT Specialist for professionals working in the asset management industry. It covers everything from new product launches to regulations and industry trends. Trials and subscriptions are available at

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