ISDA: Liquidity threshold under MiFID proposals key concern

Concern is growing over the European Securities and Markets Authority’s process of establishing definitions and thresholds in the Markets in Financial Instruments Directive – a critical part of which is the process for determining whether an instrument is liquid. If thresholds are calculated incorrectly, market makers may be less willing to provide liquidity to clients, prompting concerns that other market participants may use public data to trade against them, according to the International Swaps and Derivatives Association.