Omgeo Central Trade Manager SM

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1 Omgeo Central Trade Manager SM A DTCC Thomson Reuters Company Allocation-Confirmation Workflow: Questions and Answers This document answers the questions that clients most commonly ask about the allocation-confirmation workflow for Omgeo Central Trade Manager SM (Omgeo CTM). To describe the allocation-confirmation workflow, this document refers to XML elements in the TradeDetail message. See the XML Message Specification: Debt/Equity and Common Messages for the message layout. Table 1 outlines where to find corresponding information for the other Omgeo CTM interfaces. Table 1 Documentation for Mapping XML to Other Omgeo CTM Interfaces Omgeo CTM Interface Financial exchange Information Interface (FIX) Message Translation Interface (MTI) Trade Blotter 1 Trade Side Investment Manager Trade Component Allocation Document Title FIX 4.4 Interface Message Specification: Investment Managers Broker/Dealer Confirmation FIX 4.4 Interface Message Specification: Broker/Dealers Investment Manager Allocation Message Translation Interface Specification: Investment Managers Broker/Dealer Contract Message Translation Interface Specification: Broker/Dealers Investment Manager Allocation Trade Blotter Reference: Investment Managers Broker/Dealer Confirmation Trade Blotter Reference: Broker/Dealers Document Section Allocation Instruction (J) Confirm (AS) and Ack (AT) Fixed Income Messages Confirm (AK) and Ack (AU) Equity Messages Outbound File Submitting New or Amended Allocations Importing Contracts to Omgeo Create Allocations Without an Associated Block (ACWF) Create Confirmations Without an Associated Block (ACWF) 1. You can usually obtain the name of a trade blotter field by putting spaces in between the words of an XML element. For example, the CTMTradeSideId element in XML is the CTM Trade Side ID field in the trade blotter. What is the allocation-confirmation workflow? The allocation-confirmation workflow is a process for submitting and matching only on allocation and confirmation information. In this workflow, Omgeo CTM does not accept a separate block submission from either party. For example, in the direct XML interface, a TradeLevel submission is rejected. Parties must provide block-type information on the allocation or confirmation only. Allocation-Confirmation Workflow: Questions and Answers June 6, 2013 Page 1

2 How do I know if it is appropriate for my firm to use the allocation-confirmation workflow? The allocation-confirmation workflow is a viable solution for clients who trade in an execution or tick-bytick market. Does the allocation-confirmation workflow support all asset class transactions? Omgeo applies separate logic and workflow support for asset classes as follows: Debt and Equity Clients can choose the block-level workflow or the allocation-confirmation workflow. Futures and Options The XML Message Specification: Exchange Traded Derivatives outlines the executing and clearing trade flows for futures and options. The clearing flow is similar to the allocation-confirmation workflow because you only submit allocations or confirmations. Review Chapter 1 of that document to determine which workflow is appropriate for your firm. Is there a subscription requirement to use allocation-confirmation workflow? Yes. When you review your business requirements with an Omgeo Integration Consultant, ensure that you subscribe to Omgeo CTM Allocation Confirmation Workflow (ACWF). Does my counterparty require a subscription? Yes. Your counterparty must use Omgeo CTM and subscribe to Omgeo CTM Allocation Confirmation Workflow (ACWF). If I subscribe to the Omgeo CTM Allocation Confirmation Workflow (ACWF), can I also use the block-level workflow with my counterparties? That depends on which side of the trade you are on: Investment managers can subscribe only to a single workflow from a given Business Identifier Code (BIC). Another subscription is required to use the block-level workflow. Broker/dealers can subscribe to Omgeo CTM Allocation Confirmation Workflow (ACWF) and the block-level workflow subscription option, Omgeo CTM Block Allocation Confirmation Workflow (BACW). Does the allocation-confirmation workflow use the same central matching process as blocklevel trades? Omgeo CTM enforces matching rules on the same fields. However, since an allocation or confirmation constitutes an entire trade side, Omgeo applies minor changes to the three major matching statuses. Table 2 describes those statuses for the allocation-confirmation workflow. Table 2 Matching Status Fields for Allocation-Confirmation Workflow Trades Status Description XML Field Trade Blotter Field Match If the TradeDetails are MATCHED, then the trade sides are automatically MATCH AGREED. TDMatchStatus Investment Managers: Alloc Status Broker/Dealers: Confirm Status Complete Omgeo CTM persistently sets the trade side value to COMPLETE. CompleteStatus Both trade sides: Complete Match Agreed Omgeo CTM processes the TradeDetail as an entire trade side so that a MATCH AGREED trade is the end point for a successful trade. MatchAgreedStatus Both trade sides: Match Agrd Page 2 Omgeo Central Trade Manager

3 How does Omgeo CTM handle L1 pairing and L2 matching for Price in the allocationconfirmation workflow? Price is a potential L1 pairing field, L1 tie-breaker, or eligible L2 matching field. See L1 Pairing and L2 Matching: Questions and Answers. How does Omgeo CTM handle L1 pairing and L2 matching for total values in the allocationconfirmation workflow? In the allocation-confirmation workflow, you and your counterparty include block type information in the TradeLevelInformation composite of each allocation or confirmation (TradeDetail). This composite provides Omgeo CTM with all of the information required to perform L1 pairing and L2 matching. Note For allocation-confirmation workflow trades, Omgeo CTM always sets the TLMatchStatus and TDMatchStatus elements to the same value. A trade side has one component: the allocation or confirmation, which the TradeDetail represents. In the allocation-confirmation workflow, Omgeo CTM does not match on the following fields: TotalTradeAmount TotalAccruedInterestAmount TradeChargesOrTaxes TradeCommissions TotalNetCashAmount See L1 Pairing and L2 Matching: Questions and Answers for the complete list of available matching fields. Does Omgeo CTM map any of the block fields to the allocation or confirmation fields? Because a TradeDetail represents your entire trade side, Omgeo CTM uses the allocation or confirmation fields and block-type fields in Table 3 equally: Table 3 Equivalent TradeDetail and TradeLevel Fields in Allocation-Confirmation Workflow Trades Allocation or Confirmation Fields (TradeDetail) TradeDetailReferences/ClientAllocationReference TradeDetailReferences/CTMTradeDetailID TradeDetailData/QuantityAllocated TradeDetailData/TradeAmount Block Type Fields (TradeLevel) TradeLevelReferences/MasterReference TradeLevelReferences/CTMTradeSideId TradeLevelInformation/QuantityOfTheBlockTrade TradeLevelInformation/TotalTradeAmount How do I identify my direct XML message trades without any block type identifiers? If you require block type identifiers, use the following guidelines when you submit XML messages: New Trades When you submit a new allocation-confirmation workflow trade, such as a TradeDetail where FunctionOfTheMessage=NEWM, follow these trade identifier guidelines: The Omgeo best practice is to submit a MasterReference that is identical to the ClientAllocationReference. Conversely, if you submit a ClientAllocationReference, submit an identical MasterReference. If you do not submit a MasterReference, then do not submit a ClientAllocationReference. Conversely, if you do not submit a ClientAllocationReference, do not submit a MasterReference. If you do not want to submit a MasterReference or ClientAllocationReference, omit both fields from the TradeDetail. Allocation-Confirmation Workflow: Questions and Answers June 6, 2013 Page 3

4 Existing Trades When you submit a message for an existing trade, such as a TradeDetail where FunctionOfTheMessage=REPC, follow these guidelines: Submit a MasterReference or CTMTradeSideId or Submit a ClientAllocationReference or CTMTradeDetailID or a combination of the following: Submit a MasterReference or CTMTradeSideId and Submit a ClientAllocationReference or CTMTradeDetailID How do I match on Execution (Fill) or Average price in the allocation-confirmation workflow? Omgeo CTM investment managers can match on execution (fill) or average price for TradeDetails. Figure 1 shows an example of execution (fill) price matching. Figure 1 Matching on TradeDetail Execution (Fill) Price Table 4 describes the workflow steps in Figure 1 on page 4, which is an example and not intended to represent all allocation-confirmation workflow implementations. Table 4 Matching on Execution (Fill) Price for Allocations and Confirmations Step Description 1 Before Omgeo CTM enters the workflow, an investment manager places an order for 100,000 shares of ABC Security. 2 The broker/dealer responds with two Notices of Execution (NOEs). In this example, the broker/dealer provides the execution (fill) price for each NOE. The broker/dealer can also provide NOEs for average price. Page 4 Omgeo Central Trade Manager

5 Table 4 Matching on Execution (Fill) Price for Allocations and Confirmations (Continued) Step Description 3 On the trade side s internal systems: The investment manager processes the NOEs in a 60:40 breakdown between two funds. The broker/dealer processes the NOEs it sent to the investment manager in Step 2. Broker/dealers can use both an allocation-confirmation workflow and block-level workflow, but investment managers can only use one of the workflows. 4 The investment manager submits four allocations (TradeDetails) to Omgeo CTM, each representing a single allocation. The TypeOfPrice field is set to EXEC to indicate executing price (not average price). When combined, the allocations satisfy the broker/dealer s two NOEs. 5 The broker/dealer learns about the investment manager s allocations by the following actions: Sending a query message, such as the InfoRequest or MultiTradeDetailRequest. Receiving an event-push notification. Viewing the Alleged ACWF Allocations in the trade blotter. Communicating the information outside of Omgeo CTM. The broker/dealer reviews the AccountID, MatchingSecurityCode, MatchAgreedStatus, and other trade data. The broker/dealer responds to each allocation with a confirmation (TradeDetail) for each allocation that the investment manager submits. I must link my allocations and confirmations into groups. Can I use the allocationconfirmation workflow? Yes. As long as you do not require separate matching on block type information, Omgeo CTM provides linking of allocations or confirmations. To link each of the allocations or confirmations from Figure 1, set the following fields in the TradeDetailLinkages composite: TDReferenceType=COMM TDReferenceValue=Same identifier in each linked allocation or confirmation Figure 2 shows TDReferenceType and TDReferenceValue elements for one linked allocation (TradeDetail) in Figure 1. To link all four allocations or confirmations, provide the same value in the TDReferenceType and TDReferenceValue elements for all four allocations or confirmations. Figure 2 Linking Allocations or Confirmations Allocation-Confirmation Workflow: Questions and Answers June 6, 2013 Page 5

6 Is settlement instruction enrichment available for allocation-confirmation workflow trades? Yes. Settlement instruction enrichment in the allocation-confirmation workflow is the same as enrichment for the block-level workflow, except enrichment is on the allocation. The direct XML interface provides enrichment on information you provide in the TradeDetail. Include settlement instructions in TradeDetail messages so that the financial and settlement information is together in one message. Settlement information includes standing settlement instruction (SSI) enrichment from Omgeo ALERT SM. See the Settlement Services Reference: SWIFT MT541/543 and CSV Mapping for more information about how to supply settlement instructions on your trades. Can I use broker matching groups in the allocation-confirmation workflow? Omgeo recommends against using broker matching groups in the allocation-confirmation workflow. Using broker matching groups prevents the executing broker from viewing an investment manager s alleged allocation. Omgeo recommends that investment managers submit trades using their broker/dealer's Omgeo CTM Business Identifier Code (BIC). Are all of the XML messages available to me in the allocation-confirmation workflow? All of the XML messages, except the following, are available for allocation-confirmation workflow trades: TradeLevel (block message) MultiTradeLevelIDResponse MultiTradeLevelRequest MultiTradeLevelResponse Can I process trade exceptions in the allocation-confirmation workflow? Omgeo CTM provides exception processing for allocation-confirmation workflow trades. Table 5 lists the locations in the XML Message Specification: Debt/Equity and Common Messages where you can learn more about exception processing. Table 5 Exception Processing on Allocations and Confirmations TradeDetail Message and Action Message Category Amend Cancel, CloseError, ForceMatch, RejectCancel, RejectComponent HistoryRequest, HistoryResponse Trade Messages Management Messages Query and Response Messages What is Omgeo s recommendation regarding the investment manager s allocations for new clients implementing Omgeo CTM ACWF? Omgeo recommends sending allocations directly to Omgeo CTM to communicate to broker/dealers as long as they can support this workflow. The investment manager provides a common block reference on each allocation to allow the broker/dealer to identify the components of a single executed block. Changes in this Version This version includes the following: Removes all instances of OASYS Global SM, which Omgeo plans to retire on June 30, Updates the link to the Client Contact Center, which provides additional features and usability enhancements and launches on June 17, Page 6 Omgeo Central Trade Manager

7 More Questions Omgeo s Client Contact Center (CCC) provides general assistance and technical help. Visit to: Enter a service request or check the status of an existing service request Search our knowledge base Access our library of documentation Obtain contact information Omgeo also offers training to clients on how our products work and how to use them. Course information and a calendar of offerings are available at Copyright 2013 Omgeo LLC. All rights reserved. Omgeo and the Omgeo logo are registered service marks of Omgeo LLC. All names of Omgeo services appearing herein are either registered service marks or service marks of Omgeo LLC in the United States and elsewhere. The U.S. Securities and Exchange Commission regulates several Omgeo services. For more information, visit has approved this document for public distribution. The examples, pictures, and data are for illustrative purposes only. This document contains no actual trade data. Allocation-Confirmation Workflow: Questions and Answers June 6, 2013 Page 7