FTSE Taps CanDeal as One-Stop Shop for ‘Enhanced’ Dealer Data

Index provider FTSE Canada—the former FTSE TMX Global Debt Capital Markets joint venture—is preparing to go live with dealer pricing from Canadian dealer-backed fixed-income and derivatives trading platform CanDeal to support its Canadian Bond Index Suite, and for inclusion in its FastQuote data service.

The multi-year agreement, finalized last year, replaces separate sourcing agreements with individual dealer firms with a consolidated data service from CanDeal’s Data and Analytics (DNA) division that collects and distributes dealer data via a single feed, and adds other features, such as composite pricing, evaluated pricing, and independent price verification services.

In other markets, FTSE frequently sources data to support its index creation activities from vendors, but in Canada has always sourced the data direct from dealers, says Paul Bowes, country head at FTSE Canada. However, sourcing the data via CanDeal is a “cleaner relationship” that allows the vendor to simplify its data acquisition and focus on its core competency of index data governance, index methodology, and creating new indexes.

In fact, Bowes says FTSE plans to expand its relationship with CanDeal in the future, once it has completed the transition to CanDeal as a source in the coming months.

“Our first focus will be on our current suite of products, as we have a large suite of fixed income indexes. But what we’re hoping is that this quality data from CanDeal DNA will increase our capacity to create new indexes,” Bowes says, adding that FTSE has some ideas for potential new indexes, but is not yet ready to share any details of its plans.

Andre Craig, EVP of CanDeal DNA, says that although the deal does not give FTSE exclusivity to any CanDeal data, the index provider does have a “meaningfully preferred” status that gives it a number of privileges, including the right to use CanDeal’s evaluated pricing as an input to its index calculation process. The pair are considering using CanDeal’s evaluated prices as a pricing input to a suite of indexes, he adds.

Meeting FTSE’s requirements forced CanDeal to “up its ante” with enhanced scope and coverage of money markets, credit, and municipal bonds, and in addition to raw dealer prices, also provides yields, spreads, and benchmarks—making its content more valuable overall.

“More ingredients going into the pricing means we can deliver more insight,” Craig says. “The reference data also has a lot of uses. For example, there is a lot of value in our curves for market risk. There are a lot of segments of the market that would be interested in that pricing for other reasons [besides calculating indexes].”