Modern Back Office Workflows for Pricing and Reference Data: The Power of Daily Price Verification and Tolerance Checks

One of the main areas QUODD has focused on in the past few years is addressing how firms can better serve their middle-and-back-office employees with access to vital market data. What we’ve observed is that the back and middle office professionals don’t always require the bells and whistles that come with the offerings from legacy providers. But what they do need and want is the modern, reliable applications to keep up with today’s demands delivered by technology partners that truly understand their unique business needs.

The industry trend is rapidly moving towards data-on-demand that involves customized delivery models, coupled with a user-specific experience that works better with the workflow needs of middle-and-back-office employees, who are often either fully or partially remote and need immediate fingertip access.

At QUODD, we built our QX Digital Platform to bring this modern experience to our valued clients in the wealth management servicing space. In this series of posts, we aim to highlight a number of the modern workflows we’ve built over the last year to help our clients achieve better operational efficiency and scale in the back office.

Daily Price Verification and Tolerance Checks

Accuracy and reliability are non-negotiable when it comes to building a modern workflow to optimize price verification. Whether it’s custody and clearing, trust banking, wealth and asset management, fund administration, or organizations utilizing outsourcing technology platforms, the ability to track price thresholds, reconcile transactions, manage post-trade compliance, and minimize exception reporting is paramount.

A very common use case for this service is in relation to bond evaluations as every pricing service has their own methodology for pricing these instruments. Many of QUODD’s customers utilize our platform as the primary source, however the examples below are particularly relevant to use as a secondary source.

For example, a customer has an asset master of high grade municipal bonds and their primary source has reported prices that fall outside of the entity’s tolerance breaks. By using the QX Query tool users can upload their list of instruments, select the price date and pull our bond evaluations, evaluated by market leading S&P bond evaluators, as a secondary source to compare the evaluations. Users can also directly challenge the price and receive an explanation back within hours providing the rationale as to how our price was determined or perhaps amending the price based on the price challenge and other factors that may change the evaluation provided. Either outcome provides clarity on the variance and allows customers to determine the best outcome for their clients.

Our workflow is built to run automatic checks on stale prices or prices that are outside of a set tolerance that’s pre-configured.

The QX Query environment has been specifically designed to run user-defined Securities of Interest (SOI) reports for timely and consistent pricing for all asset types. Users can customize their workflows with instantaneous responses to bulk queries by creating templates that automate this independent source of pricing data. Analysts can instantly verify and, if applicable, correct exposures.

By using these checks to validate prices and ensure they fall within specified tolerances, financial institutions and technology service providers can safeguard their reputations, protect assets, and instill confidence in their clients and investors.

About QUODD’s QX Digital Platform 

QUODD built a fit-for-purpose digital platform that gives customers access to reliable and comprehensive market data functionality and content for middle and back-office workflows.

The QX Digital Platform delivers the highest quality, proven, reliable, and cost-effective source of comprehensive security pricing, reference data, and analytics across all asset classes, integrating best-of-breed content providers for funds, equities, and fixed income via a web-based market data portal. In 2023, QUODD tripled the number of companies using the QX Digital Platform.

Serving as a cornerstone of the QUODD market data suite of products and services, QX Digital Platform was built to help wealth management servicing firms to connect the workflows between the back to middle to front offices; empowering financial institutions with the operating efficiency and controls to most effectively support data management and client servicing needs.

QX Digital Platform is utilized as a primary or secondary source by leading institutions in the bank wealth management, trust, and retirement segments and/ or by their enabling technology platform providers that are continuing to grow as operations outsourcers.

The technology powering QX Digital Platform ingests, normalizes, and productizes best-of-breed sources of market data content for consumption with the lowest amount of friction.