Chapter 10
The Role of Accurate Static Data in the STP Process
The accuracy of static data is a significant factor in achieving STP. Incorrect or incomplete static information is a common cause of trade processing errors. The static data challenge for securities firms can be said to be to1:
- Gather the required data from disparate sources
- Store it securely
- Update it when necessary
- Utilise it appropriately.
This chapter explores the most important items of static data that need to be held regarding:
- The financial instruments that are traded
- The trading parties that the firm deals with
- The settlement agents used by the firm and its trading parties
- Divisions, departments and business units of the firm, including trading books
- Countries in which these various entities are located.
10.1 STATIC DATA OVERVIEW
In Figure 10.1, ABC Investment Bank has a number of dealing teams or trading books. The trading books buy and sell financial instruments that include bonds, currencies, futures and options and equities. The instruments, in turn have parameters, including price calculation methods – for all instruments – and interest rates and interest calculation methods – for bonds and currencies. There are also standard identifiers used throughout the industry to uniquely identify instruments, as well as rules that apply to the markets in which the instruments are traded.
Figure 10.1 Static data overview
In turn, all instruments are denominated in a currency – that is to say, bonds, equities, ...
