CACEIS, NYSE Euronext and SunGard "MiFID & Best Execution Research Chair"
The CACEIS, NYSE Euronext and SunGard "MiFID & Best Execution Research Chair" is under the scientific responsibility of Jean-René Giraud, Director of Development at the EDHEC Risk and Asset Management Research Centre and Research Associate in charge of the "Best Execution and Operational Performance" research programme.
The MiFID & Best Execution Research Chair will be supported jointly by CACEIS, NYSE Euronext and SunGard over a three-year period enabling the EDHEC Risk and Asset Management Research Centre to implement a long-term research strategy in this field. The themes of MiFID and Best Execution are thought to be among the most significant industry challenges for the near future, justifying the need for academic research to be carried out to support industry developments.
The MiFID directive is establishing a very open and competitive market for execution and other investment services by recognising new forms of execution venues, systematic internalisation and the end of the concentration obligation. Regulators have to ensure that new developments will not result in less efficient or transparent markets that could harm the end investor. Although the intentions of the Directive are clearly to protect the investor by introducing a number of significant new obligations for European investment firms (best execution and pre- and post-trade transparency for transactions carried out on- or off-exchange), there may be concerns about the results one can expect from the rule.
The first steering committee meeting was organised in Paris on September 18th, 2007 to establish a provisional working plan for the three-year period and agree upon the research orientations for the first academic year:
- The focus for the first academic year will be on documenting the state of the art in Transaction Cost Analysis.
- As a second step, the research team will focus their efforts on a better understanding of the various components of those transaction costs, covering explicit (such as fees, but also direct and indirect back office costs) and implicit costs, and document further the relative impact of frictions within order books.
- The research chair will focus at a later stage on the various market models and the emergence of new forms of negotiation and its impact on market fragmentation, while analysing the impact of this fragmentation on the overall execution cost structure.
The research output from the MiFID & Best Execution Research Chair will be published in this section in due course.
[Consult the press release announcing the launch of the research chair: 08/11/07]
EDHEC's previous work in this field:
Books
- Giraud & D'Hondt, "MiFID: Convergence towards a Unified European Capital Markets Industry" Risk books, October 2006.
Position Papers
- Giraud & D'Hondt, "MiFID: the (in)famous European Directive?", EDHEC Position Paper, March 2007.
Surveys
- Giraud & D'Hondt, "Transaction Cost Analysis in Europe: Current and Best Practices", European Survey, January 2007.
Articles
- Giraud & D'Hondt, "Cash Equity Transaction Cost Analysis: State of the art ... and beyond" in Journal of Asset Management, Volume 7, Issue ¾, 2006.
Conference Presentations
- "Transaction Cost Analysis" presented at the TradeTech Conference, Paris, April 2006.
- "MiFID & the Challenges of Best Execution" presented at the EDHEC Asset Management Days, Geneva, March 2007.
- "Obligation de meilleure exécution et performance opérationnelle: menaces et opportunités de la directive MIF" presented at EDHEC Research Day, Paris, June 2007 (presentation in French).
