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Stirring BOAT’s waters

I am regularly hearing
half-truths and inaccuracies to cause confusion and issue, and this is
particularly true as the battle grows between the old and new
exchanges, and the old and new players in the investment markets. 

One example is BOAT, formerly Project Boat.

Due
to folks giving me duff information, I’ve reported on BOAT a couple of
times only to be told afterwards that the information was naff … so I
thought I’d give you BOAT’s side of the story.

First, I wrote
about issues with BOAT’s pricing model a while ago.  It turns out that
the accusation of BOAT being expensive is a half-truth. 

The
figures that were being quoted on that occasion gave the impression
that BOAT’s pricing was expensive.  The figures being used were most
likely based upon total number of trades and not on the value of those
trades.  Not all trades are equal in value and those that are of larger
size are more interesting to the market, which is why BOAT’s
pricing looks at the value of trades.  Equally, no mention was made of
BOAT’s data being pan-European and that BOAT represents two-thirds of
all of Europe’s off-exchange share trading.

In other words,
the figures were comparing apples and pears, rather than apples with
apples.  As a result, the people who were at that event walked away
with the impression that BOAT would be ten to twenty times more
expensive than comparable players when the comparable players are not,
in fact, comparable.

At Tuesday’s Exchanges conference, a
certain gentleman asked the question as to whether the fact that BOAT
had not gained TDM approvals from the FSA would scupper their plans.
In fact, the way he asked the question would have meant that the
audience would get the impression that BOAT had been rejected for TDM status by the FSA. 

This
is not true and BOAT’s folks rang me yesterday morning to say: "The
BOAT TDM application is in process.  The TDM audit is being
finalised which is a key part of the information required by the FSA.
BOAT will update the market in due course."

It doesn’t change
the question of whether the FSA’s usage of TDM status is acceptable
under MiFID, which was the point that was the greatest source of
debate, but it does show how misinformation can be used to ill effect.
For example, stating that BOAT isn’t a TDM is different to saying
BOAT’s TDM application is in process.

And this is their key point.  BOAT has not had its application rejected, it is in process. 

BOAT also sent me the following announcement, just released:

As part of a marketing initiative to demonstrate the value, accuracy
and breadth of its data, BOAT will offer its real-time dataset free of
charge to both potential and existing clients until 1 January 2008.  In
addition, following extensive consultation of potential clients, market
data vendors, trade associations, consultants and user groups, BOAT
will provide a delayed datafeed which will be made available free of
charge as from 1 January 2008.

In summary, it’s all well
and good to deal out information to question firms and their plans, but
such debate needs balance and a BOAT doesn’t float without balance.

About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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