OPRA Seeks New SIP Operator, Enlists Jordan & Jordan to Run RFP

Management and market data consultancy Jordan & Jordan issued an RFP on behalf of OPRA to potential providers today, Friday Dec. 20, which invites potential suppliers to notify J&J of their intent to bid for the business by the middle of January before submitting final bids by mid-February. Then J&J will assemble a shortlist of three or four potential providers for evaluation by the OPRA Committee in mid-March, based on certain pre-specified criteria set by the OPRA Committee and J&J, after which J&J officials expect OPRA to select a provider in April.

OPRA's SIP is currently operated by NYSE Euronext technology arm SIAC (the Securities Industry Automation Corp)─which may well participate in the bidding to retain the contract. With this deal up for renewal at the end of this year, OPRA decided to open the contract to tender in the interests of due diligence, and extended the current SIAC deal long enough to cover the time required to select a provider and for any new provider to develop its service.

"The RFP will request that bidders be ready to start providing the service in the first quarter of 2016, to give them a year to build and test their service," says Janet Early, senior industry consultant at J&J, adding that J&J expects to receive bids from exchange operators, technology vendors and managed service providers.

Early says OPRA's decision to investigate potential new providers was unrelated to OPRA data incidents earlier this year─one in September, when a software upgrade glitch caused problems with calculation of national best bid and offer (NBBO) prices, forcing options exchanges to halt trading (IMD, Sept. 16; Sept. 20), and another in October when data from the International Securities Exchange was temporarily excluded from OPRA's NBBO calculation (IMD, Oct. 30)─and that OPRA approached J&J prior to these issues. However, she says that in light of the incidents, reliability and availability will be key factors in the selection process, along with other factors such as capacity as well as proposals for improved designs that deliver better performance while provide the same core capabilities.