Transaction Costs

A calculation engine developed by RiskConcile

The PRIIPs regulation requires a complete cost transparency for investment products in their Key Information Document (‘KID’). This includes disclosure of the implicit transaction costs of trading underlying instruments. 

To capture these implicit transaction costs, the regulator imposes the slippage or arrival price methodology. New products, or products for which insufficient data are available, can use the new PRIIPs methodology (half-spread).

With regards to MIFID, the ESMA expects alignment with the PRIIPs methodology for the ex-post transaction costs disclosure to investors. 

The European Supervisory Authorities recently confirmed that the arrival price methodology is there to stay.

Capture both explicit and implicit transaction costs.

Slippage or Arrival Price Methodology

Slippage is the difference between the arrival price and the execution price of a trade. Sourcing arrival prices requires large amounts tick history.

New PRIIPs Methodology

An estimation of the implicit costs can be made. This approximation uses the turnover at the asset-class level and the corresponding half bid-ask spread. This methodology is also known as the half-spread or portfolio turnover methodology.

How it works

TCALab is a “one-stop shop” for the calculation of your transaction costs.
Available as a Managed Service or SaaS (Software as a Service).

Step 1: Trade File

We are flexible with regards to the type and delivery of the trade files.

Step 2: Enrichment

All trades are enriched with tick history (to source the arrival price) and half-spread data.

Step 3: Calculation

TCALab calculates the transaction cost for each trade and aggregates them at fund level.

Why choose RiskConcile?

RiskConcile is a FinTech with a focus on Risk and Regulatory Technology. We combine a deep operational experience in the financial sector with a technological mindset. Our clients are asset managers based across the globe and include multi-billion investment management firms, hedge funds, law firms, private equity funds and Big-4 audit firms.

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Operational experience

Our team consists of former derivatives’ traders, portfolio managers, risk managers and private equity professionals.

turnaround

Quick turnaround

Timing is important and we promise to deliver on time.

complex

Complexity

We have a strong experience with calculating transaction costs for a wide variety of (complex) instruments.

client

Client-oriented

We are able to adapt our solutions on-the-fly to accommodate your needs.

best-price

Pricing

We are proud to offer strong value for a competitive price.

Want more information?

Do you need assistance with your transaction cost calculation?
Please reach out and we will contact you within 24 hours!