MiFID/MiFIR and transparency for OTC derivatives
This paper has been produced by the International Swaps and Derivatives Association to describe the nature of trading structure and liquidity formation in OTC derivatives markets and the implications for framing pre-trade transparency obligations under MIFID2/MIFIR. The paper makes the following points:
- Different trading models exist for different instruments.
- Pre-trade transparency differs according to the nature of a given trading model.
- Pre-trade transparency should be calibrated by trading model and should adequately accommodate request for quality trading systems