What is Trade Surveillance?

Trade Surveillance is the process of monitoring and analyzing trade activities, including orders, executions, and other trade-related data. The goal is to identify any potential violations of internal policies or regulatory requirements relating to trading activities. Trade surveillance is conducted to detect potential market abuses, insider trading, or other forms of trading misconduct within the financial industry.

The problems to overcome and challenges associated with trade surveillance encompass:

  • Vast Data Volumes: Enormous amounts of trading data must be processed and analyzed in real time, posing a significant data management challenge
  • Complex Regulatory Landscape: Evolving and diverse global regulations require financial institutions (FIs) to adapt their surveillance processes continually
  • False Positives: Inaccurate alerts can lead to the wasting of resources on investigating benign activities
  • Siloed Surveillance Systems – many firms leverage multiple systems looking at distinct datasets, and these disconnected systems don’t communicate with each other, leaving firms with an incomplete picture of events, and missing risks.
  • Real-time Analysis: Timely identification of suspicious trading patterns is essential to prevent market abuse, which demands real-time analytical capabilities

For example, an investment firm may uncover an instance where one of its employees engages in trading activities based on non-public information related to a merger, a clear case of insider trading. Alternatively, a trader might attempt to influence stock prices through a coordinated strategy of buying and selling known as "pump and dump," thereby highlighting the significance of trade surveillance in identifying such trading misconduct.

How can NICE Actimize Help

NICE Actimize offers robust trade surveillance solutions to address these challenges:

  • Real-time Monitoring: NICE Actimize provides real-time monitoring capabilities, allowing immediate detection of suspicious trading patterns
  • Multidimensional Analytics: The platform leverages advanced analytics and machine learning to improve detection accuracy and reduce false positives
  • Holistic Surveillance: The platform can analyze trade data, along with communications, HR and other employee data to more accurately and efficiently detect misconduct
  • Regulatory Expertise: NICE Actimize maintains an up-to-date understanding of global financial regulations and assists institutions in staying compliant
  • Regulatory Expertise: NICE Actimize maintains an up-to-date understanding of global financial regulations and assists institutions in staying compliant
  • Industry Leading Case Management: The platform is built on an industry leading case management platform with automated workflows, enhanced collaboration, and powerful visualizations
  • Scalability: The platform can handle vast data volumes, making it suitable for both large and small FIs
  • Customized Analytics: NICE Actimize's analytical models can be tailored to fit specific business requirements, ensuring accurate monitoring

Learn more about NICE Actimize's Trade Surveillance Solutions

By using NICE Actimize's trade surveillance and Financial Market Compliance solutions, FIs can proactively detect and prevent illicit trading activities, comply with regulations, and maintain market integrity.

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