Best Corporate Actions Data Initiative: Exchange Data International

The cost of data continues to make headlines in the financial industry as vendors continue to change fee structures. The winner of the Best Corporate Actions Data Initiative award is on a mission to protect consumers from rising costs and has been celebrated for introducing competition in the sector. Exchange Data International (EDI) was named best vendor in this category for its corporate actions data feed, which aims to provide consumers with an alternative to the New York Stock Exchange’s (NYSE) corporate actions data.

For consumers such as custodians, index providers and credit rating agencies, it is essential to be able to redistribute corporate actions data—and the EDI feed removes a second level of charges imposed by NYSE on clients who want to redistribute. To address the cost challenge for consumers, EDI has taken the initiative of offering consumers a cheaper alternative to NYSE corporate actions data by bypassing the exchange and sourcing the data direct from issuers.

Jonathan Bloch, CEO of EDI, says there were logistical issues to overcome when launching the new service, including the data gathering process—which now involves direct contact with thousands of issuers. “We’ve had to add significantly more resources and increase our IT capabilities,” he says.

But the result for customers is a corporate actions feed that is royalty‑free and less expensive than taking the data directly from the exchange. With a long history in corporate actions, EDI’s service provides corporate actions events affecting global equities from over 150 exchanges worldwide and data for more than 31,000 US mutual funds. The feed is updated three times a day and features detailed announcements on many event types, including dividends, takeovers and stock splits.

The judges noted that EDI has always been a strong player in this space, and that the recent changes are “a good example of this company upgrading its service and then facing off against a legacy single-source supply chain within the market/reference data industry.” In fact, according to the judges, any initiative that disrupts exchange monopolies on commoditized datasets for its listed instruments is a winner.

For Bloch, the introduction of redistribution fees for data with limited value add is a cause for concern. “This sets a very dangerous precedent,” he says, adding that he believes a number of other exchanges are also considering initiating redistribution fees, but EDI will continue to battle for users and other vendors: “We believe exchanges should charge a reasonable fee for the services they provide, but not create situations where the costs are exorbitant.”

Read more about the IMD/IRD Awards 2018 winners