Interactive Data Unveils Liquidity Indicators Service for Fixed-Income

Interactive Data, a provider of fixed-income evaluated pricing, has launched its Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term Indicators Service, a fixed-income evaluated pricing and reference data solution that helps support pricing and trading functions, according to an Interactive Data statement.

The newly launched service will target global buy-side and sell-side firms in an attempt to provide security and portfolio-level Liquidity Indicators. The launch of the solution comes amidst a period of concern over market participants' ability to manage liquidity risk, given an observed multi-year decline in dealer inventories.

Furthermore, an anticipated future interest rate decision in the United States could potentially trigger a flight of capital from fixed income assets. Recently, the US Security and Exchange Commission's (SEC) proposed rules for liquidity Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term programs for mutual funds, which if adopted as proposed would obligate fund companies to undergo significant changes to enhance or modify their risk management operations.

Consequently, Interactive Data’s Liquidity Indicators were designed to help support and grapple with firms' liquidity risk management needs during every foreseeable economic cycle, namely in stressed or volatile markets. The utility can be used to analyze a security's liquidity relative to other securities in various groupings including issuer, sector, asset class, or against bonds with similar risk characteristics such as yield or duration.

According to Paul Kraft, Partner with Deloitte & Touche LLP and the head of Deloitte's mutual fund practice, in a recent statement on the launch: "Bond market liquidity continues to make headlines as regulators and participants alike want to ensure their preparedness for a rise in interest rates. The capability to model a range of liquidity scenarios in stressed and non-stressed conditions is going to become more of a part of the mutual fund playbook.”

"Understanding liquidity risk is a top priority for many global financial institutions. This was confirmed in the feedback we received during our recent pilot program, particularly with mutual fund companies, given applicable regulatory guidelines and responsibilities to service shareholder redemptions on a daily basis," added Andrew Hausman, President, Interactive Data Pricing and Reference Data in an accompanying statement.

"Our clients need to have confidence in their risk assessments, including analysis of their ability to exit a position at a particular price and the overall liquidity profile of their portfolio relative to the market. These tools can help them do that.”

Back in June, Tradelegs partnered with Interactive Data in order to gain access to the company’s vast data feeds. The joint solution aggregates content from more than 450 sources and relays them globally into a normalized format supported by Interactive Data’s distributed ticker plant architecture.