Recently, I connected with BroadPeak for an update and spoke with Sachvir Cheema and Aakash Kakkad about the company with an emphasis on its trade surveillance solution. BroadPeak offers data integration and intelligence solutions for energy and commodity trading firms. Solutions include data integration, position limits, trade capture, trade reconciliation, regulatory reporting, trade allocation and trade surveillance. “Data integration serves as our core differentiator enabling real-time trade capture, the harmonization of multiple data sources into unified compliance language, and user-controlled mappings,” Aakash explained.
All of BroadPeak’s solutions are built on its unified data integration platform, they told me. “Users control and define data mappings from source to target with pass-through mappings and value mappings for data transformation,” Aakash said. Furthermore, the system harmonizes data into a single compliance language, meaning that trader IDs, clearing accounts and other metadata across platforms do not need to be translated. Like all good data management tools, it also enriches exchange data before mapping into surveillance schema, ensuring high data quality, the said.
It enables integration of OTC trades, bilateral swaps, and all off-exchange transactions alongside exchange data, and raw order data is accessible within the surveillance tool—“every button click on the exchange is captured as an individual record.” Currently, the company has around two dozen clients using the solution, with several more at the signing stage and is seeing strong interest in the solution.
The system demo’s very well and users land on a usable dashboard showing open alerts, active cases, events over last 30 days, and heat map of highest surveillance event activity by trader.
It displays multiple event types: trade level, order level, and surveillance events (wash trades, spoofing, layering) and users can configure multiple custom views to filter by specific surveillance types, exchanges, or traders. It also provides error logs for any data ingestion or analytics job failures. BroadPeak is one of few solutions that is built for the vagaries of energy and commodities.
The solution is easily configurable and offers the ability to slice, dice and measure in many different ways. For example, the core wash trade report “follows deterministic regulatory rules: offsetting transactions, same contract, same trading day, similar price. Users can narrow time window for offsetting transactions (e.g., 60 seconds instead of full trading day). Price sensitivity configurable as percentage threshold—can set to 5%, 2%, or 0% for exact price matching,” and much more. The spoofing report identifies orders placed with no intention of being filled per regulatory definition and again it offers flexibility such that users can set time-to-cancel thresholds (e.g. zero seconds captures algo trading, 1+ seconds captures trader behavior patterns,) and much more.
One powerful feature is the ability to decouple alerts from surveillance events so that reports can run wide while alerts trigger on more narrow and refined criteria. For example. users can “view all potential wash trades in reports but only generate alerts for trades within 60 seconds at 5% price sensitivity.” Alerts can be acknowledged or escalated to cases directly from any report view and cases display full transaction details, trader information, and sequential audit history without requiring reference back to reports. Importantly, the system also provides a complete auditable trail – case created, references added, status changes, for example, are all logged.
The system features many other usable functions in terms of reports, drill-down capabilities and time-based analysis. Reporting capabilities include physical and financial positions to assess hedging strategy and proce divergence and position change reporting as well as the ability to connect Power BI or Tableau to the surveillance data mart to build custom reports. Other reports are in progress, they said like a block trade report and bid week report. BroadPeak will develop reporting in field with customers and then them elevates into the product—power/ISO surveillance becoming prevalent even among non-power traders, they said.
The market for trade surveillance solutions is strong and, to some extent, fines are driving awareness. Many firms previously bought peer-to-peer solutions just to check the box without commodity relevance and are now looking to gain real functionality for commodities. Some organisations use spreadsheets, they told me, but again as trade volumes increase, they realise the need a proper solution. “Compliance offices increasingly working closely with middle office and having strategic conversations with front office traders,” they said. “Organizations excelling in the market are ones where front, middle, and back offices communicate across teams.”
