Trading Data Should Belong to the Customer, not the Broker

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2022-01-13 20:30:07

Proof Trading is enacting a new data policy that hands back control over trading data to each respective customer. The full legal agreement can be found here, and please see additional background information below.

Investment firms tend to be extremely secretive, even paranoid, when it comes to protecting their trading data, and understandably so. Some family offices and proprietary trading firms go so far as to try to hide their very existence — presumably this is only feasible when you don’t need to attract outside money, although I’m sure it poses serious challenges for recruiting talent as well. There are many reasons why an asset manager might be private, such as avoiding unwanted regulatory scrutiny or reducing the likelihood that skittish investors pull their funds during a performance dip, but the most common reasons are:

Most institutional investors spread their trading across multiple execution brokers. The most secretive funds split their holdings across multiple custodians, so that no one firm is in a position to try to reverse-engineer their strategies.