New Interface Supports Communications with Pricing, Risk Management, Databases and Clearinghouses
Pivot, Inc., the leading provider of instant messaging and liquidity management software to the trading community, today unveiled an extensively updated version of its Pivot Connect application programming interface (API), which supports automated communications with internal systems as well as connectivity to external trading, clearing and data entities mandated by proposed Dodd-Frank regulations.
The new version of Pivot Connect supports seamless connections of consolidated data feeds of instant message data into pricing, trade execution and risk management systems, enabling instant, robust market making and trade communication with market counterparties and clients.
“Connecting instant messages to pricing engines, order management systems and middle office applications improves trading room workflow which increases profitability,” said John H. Eley, ceo, Pivot Inc. “Pivot Connect expands the enterprise functionality of instant message systems to drive new business opportunities for financial and as well efficient compliance with new regulation.”
In addition, Pivot Connect supports end-to-end connectivity with new market structures created in Dodd-Frank regulation, including Swaps Execution Facilities (SEF) and Swaps Data Repositories (SDR) as well as centralized clearinghouses, through which many types of swaps transactions will be required to be cleared.
Firstly, Dodd-Frank mandates many conversational dealing activities to be moved to electronic means. Pivot’s instant message-based conversational technology fulfills this mandate and, in fact, is already very widely used in OTC markets, where an estimated 80 per cent of conversational dealing is now done via instant message versus 20 per cent via voice.
Secondly, Dodd-Frank mandates that eligible OTC swaps transactions be cleared through designated centralized clearinghouses in a fundamental shift from bilateral clearing protocols used currently. This change will affect most actively traded swaps contracts, with industry estimates ranging upwards from 60 per cent depending on the underlying market. Pivot Connect is currently in use to deliver OTC derivatives transactions to centralized clearinghouses. This post-trade functionality is significantly enhanced in the new release to meet the extensive proposed regulatory requirements.
Pivot Connect is offered as a system module or bundled into the company’s Instant Markets™ product. Instant Markets™ includes proprietary text parsers that convert text-based chat into machine-readable product and price data. This data is fed into a firm’s price and risk engines via the API in real-time as well as displayed on a blotter enabling traders to see all relevant deal, pricing and risk information in a one centralized location. Traders can respond to incoming trade queries directly from the blotter with a single mouse click.
