Introduction

TT Trade Surveillance is a trade surveillance tool that uses pattern recognition based on machine learning to identify trading behaviors that pose the greatest regulatory risk to your firm. It scores all activity based on similarity to actual regulatory cases such that compliance officers can identify risk, prioritize work and address problematic trading behavior.

TT Trade Surveillance is an integrated component of the TT platform that requires no implementation or integration and can simply be activated in Setup. Through the TT platform, TT Trade Surveillance has immediate access to trading data. TT Trade Surveillance also lets users with order and fill data from outside the TT platform import their data into TT Trade Surveillance through the TT FIX Inbound Drop Copy service.

TT Trade Surveillance features a number of data visualizations and filters to assist in the review and evaluation of trading activity and provides the ability to record dispositions.

TT Trade Surveillance surveillance models

TT Trade Surveillance uses the following models to analyze data for problematic trading patterns:

• Abusive Messaging: Quote stuffing schemes designed to introduce predictable latency into an exchange's quoting engine or malfunctioning algorithms that might cause market disruptions.
• Automated Collusive Spoofing: Patterns of manipulative or disruptive trading activity by multiple traders working together to automatically submit a number of orders for which they have no intention of executing in an attempt to move the market.
• Automated Spoofing: Patterns of manipulative or disruptive trading activity that involve the automated placement of a number of orders for which a trader has no intention of executing in an attempt to move the market.
• Collusive Spoofing: Patterns of manipulative or disruptive trading activity by multiple traders working together to place a number of orders for which they have no intention of executing in an attempt to move the market.
• Cross Trading: A cross trade occurs when a buy order and a sell order for the same instrument are entered for different accounts under the same management, such as a broker or portfolio manager.
• Exchange Messaging Rate Limits: Instances where traders exceeded the exchange message rate limit for a set period of time during a trading session.
• Influencing the Open: Instances where indirect wash trades occurred at the open of trading in violation of exchange rules.
• Marking the Close: Trading activity intended to manipulate the settlement price of an instrument during its settlement period.
• Momentum Ignition: Behaviors that indicate an attempt to create an artificial price movement with aggressive orders followed by an attempt to capitalize on such movement.
• Pinging: The entry of multiple small orders intended to discover hidden book depth followed by a series of order actions designed to force the large order to trade at less desirable prices.
• Price Ramping: Behavior that may be an attempt to create artificial price movement with aggressive orders.
• Spoofing: Patterns of manipulative or disruptive trading activity that involve the placement of a number of orders for which a trader has no intention of executing in an attempt to move the market.
• Wash Account: The same account ID is both the buyer and seller in the same transaction.
• Wash Trader: The same trader ID is both the buyer and seller in the same transaction.
• Dominance at Open: A single trader's orders make up the majority of the disclosed market volume of an instrument during the first 15 minutes of the current trading session.
• Order Book Dominance: A single trader's working orders make up the majority of the disclosed market volume of an instrument at any time during a trading session.