# How Can a Firm Quantitatively Prove Best Execution When Using a Systematic Internaliser? ▴ Question

**Published:** 2025-08-05
**Categories:** Question

---

![Translucent teal glass pyramid and flat pane, geometrically aligned on a dark base, symbolize market microstructure and price discovery within RFQ protocols for institutional digital asset derivatives. This visualizes multi-leg spread construction, high-fidelity execution via a Principal's operational framework, ensuring atomic settlement for latent liquidity](https://options.greeks.live/wp-content/uploads/2025/07/transparent-geometric-structures-visualizing-multi-leg-spread-rfq-protocols-for-high-fidelity-institutional-digital-asset-derivatives-execution.jpg)

![Metallic rods and translucent, layered panels against a dark backdrop. This abstract visualizes advanced RFQ protocols, enabling high-fidelity execution and price discovery across diverse liquidity pools for institutional digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/precision-market-microstructure-for-institutional-digital-asset-derivatives-rfq.jpg)

## Concept

The challenge of quantitatively proving [best execution](https://prime.greeks.live/area/best-execution/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) when utilizing a [Systematic Internaliser](https://prime.greeks.live/area/systematic-internaliser/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) (SI) is fundamentally a question of data architecture and analytical integrity. A firm’s decision to route an order to an SI is a decision to engage in a bilateral execution, moving the trade away from the multilateral price discovery of a lit exchange. The core task, therefore, is to construct an evidentiary framework that demonstrates this choice consistently yields a superior, or at minimum equivalent, outcome for the client compared to all other viable alternatives. This requires a system capable of capturing not just the execution data itself, but a high-fidelity snapshot of the entire market landscape at the precise moment of the trade.

An SI is an investment firm that deals on its own account by executing client orders outside a regulated market, MTF, or OTF. It operates as a principal, offering liquidity from its own book. This structure presents both an opportunity and a challenge. The opportunity lies in the potential for [price improvement](https://prime.greeks.live/area/price-improvement/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), access to liquidity that may not be present on lit venues, and reduced [market impact](https://prime.greeks.live/area/market-impact/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) for large orders.

The challenge is one of transparency and proof. Unlike a [central limit order book](https://prime.greeks.live/area/central-limit-order-book/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) where the prevailing best bid and offer are publicly visible, an SI’s quotes are provided directly to the client, often through a Request for Quote ([RFQ](https://prime.greeks.live/area/rfq/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)) process. Proving best execution in this environment moves beyond simply recording the transaction price. It requires a dynamic, counterfactual analysis ▴ comparing the price achieved through the SI against the prices that were simultaneously available on the consolidated European tape.

> A firm must systematically prove that its bilateral executions are superior to the publicly available alternatives at the moment of trade.

The regulatory framework, specifically [MiFID II](https://prime.greeks.live/area/mifid-ii/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), mandates that firms take “all sufficient steps” to obtain the best possible result for their clients. This obligation is not waived when using an SI. In fact, the burden of proof becomes more acute. The firm must demonstrate that its selection of an SI as an execution venue is part of a deliberate and effective [order execution policy](https://prime.greeks.live/area/order-execution-policy/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite).

This involves a continuous process of monitoring, analysis, and justification. The [quantitative proof](https://prime.greeks.live/question/how-does-encrypted-communication-in-rfq-systems-affect-regulatory-compliance-and-best-execution-proof/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) is derived from a meticulous comparison of the SI execution against a set of predefined benchmarks, primarily the European Best Bid and Offer ([EBBO](https://prime.greeks.live/area/ebbo/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)), at the time of execution. The quality of this proof is entirely dependent on the quality of the data captured and the rigor of the analytical models applied.

![Stacked matte blue, glossy black, beige forms depict institutional-grade Crypto Derivatives OS. This layered structure symbolizes market microstructure for high-fidelity execution of digital asset derivatives, including options trading, leveraging RFQ protocols for price discovery](https://options.greeks.live/wp-content/uploads/2025/07/multi-layered-institutional-digital-asset-derivatives-rfq-protocol.jpg)

![An intricate, transparent cylindrical system depicts a sophisticated RFQ protocol for digital asset derivatives. Internal glowing elements signify high-fidelity execution and algorithmic trading](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-protocol-architecture.jpg)

## Strategy

A robust strategy for proving best execution with a Systematic Internaliser is built upon three pillars ▴ a comprehensive data collection protocol, intelligent benchmark selection, and a rigorous counterfactual comparison framework. This strategy must be codified within the firm’s formal Order [Execution Policy](https://prime.greeks.live/area/execution-policy/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), providing a clear and defensible methodology for why and when SI liquidity is accessed. The objective is to transform the best execution process from a compliance formality into a system for continuous [execution quality](https://prime.greeks.live/area/execution-quality/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) improvement.

![Sharp, intersecting geometric planes in teal, deep blue, and beige form a precise, pointed leading edge against darkness. This signifies High-Fidelity Execution for Institutional Digital Asset Derivatives, reflecting complex Market Microstructure and Price Discovery](https://options.greeks.live/wp-content/uploads/2025/07/high-fidelity-digital-asset-derivatives-rfq-market-microstructure-2.jpg)

## The Data Collection Protocol

The foundation of any quantitative proof is the underlying data. The strategy must ensure the capture of a complete and time-stamped record of every stage of the order lifecycle. This is a non-trivial data engineering challenge, requiring the integration of information from multiple internal and external systems. The goal is to create a single, unified record for each trade that contains all the necessary data points for a complete post-trade analysis.

Key data points to be captured include:

- **Order Inception** ▴ The precise timestamp (to the millisecond or finer) when the parent order is created or received by the firm’s Order Management System (OMS).

- **Pre-Trade Market State** ▴ A snapshot of the consolidated European [order book](https://prime.greeks.live/area/order-book/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) (EBBO) at the moment the decision to route to an SI is made. This includes the best bid and offer, depths, and the venues displaying them.

- **RFQ Process** ▴ For RFQ-based SIs, all relevant timestamps must be logged, including when the RFQ is sent, when quotes are received, and the full content of each quote from the SI.

- **Execution Timestamp** ▴ The exact time the trade was executed with the SI.

- **Post-Trade Market State** ▴ A snapshot of the EBBO immediately following the execution to assess for any potential market impact.

![A sleek, multi-component device in dark blue and beige, symbolizing an advanced institutional digital asset derivatives platform. The central sphere denotes a robust liquidity pool for aggregated inquiry](https://options.greeks.live/wp-content/uploads/2025/08/institutional-digital-asset-derivatives-rfq-execution-platform-system.jpg)

## What Are the Most Effective Benchmarks for SI Execution Analysis?

Selecting the right benchmarks is critical for a meaningful analysis. While standard benchmarks like Volume-Weighted Average Price (VWAP) or Arrival Price have their place, they are insufficient on their own for SI analysis. The most critical benchmark is the prevailing market price on lit venues at the moment of execution. This allows for a direct, “apples-to-apples” comparison.

> The core of the analysis hinges on comparing the SI’s execution price against the best available prices on public exchanges at the same instant.

The primary benchmarks for SI execution quality are:

- **European Best Bid and Offer (EBBO)** ▴ This is the most important benchmark. A buy order executed via an SI should be compared against the best offer available on any European trading venue at the time of the trade. The difference represents the quantifiable price improvement (or detriment).

- **EBBO Midpoint** ▴ Comparing the execution price to the midpoint of the EBBO spread provides a measure of how much of the spread the firm was able to capture for the client.

- **Arrival Price** ▴ The midpoint of the EBBO at the time the order was first received by the trading desk. Slippage against this benchmark measures the cost of delay and the market movement during the order handling process.

![A precise, multi-faceted geometric structure represents institutional digital asset derivatives RFQ protocols. Its sharp angles denote high-fidelity execution and price discovery for multi-leg spread strategies, symbolizing capital efficiency and atomic settlement within a Prime RFQ](https://options.greeks.live/wp-content/uploads/2025/07/digital-asset-derivatives-rfq-execution-microstructure-framework.jpg)

## A Comparative View of Execution Venues

To justify the use of an SI, a firm must understand its characteristics relative to other liquidity sources. The decision to use an SI is a strategic choice based on a trade-off between factors like price discovery, potential for price improvement, and information leakage.

| Venue Type | Price Discovery Mechanism | Potential for Price Improvement | Information Leakage Risk | Ideal Order Type |
| --- | --- | --- | --- | --- |
| Lit Exchange | Multilateral Central Limit Order Book | Low (Price Taker) | High | Small, liquid orders |
| Dark Pool | Bilateral or Multilateral (Midpoint Pegged) | Moderate (Half-spread savings) | Moderate | Medium-sized orders, sensitive to impact |
| Systematic Internaliser | Bilateral (RFQ or streaming quotes) | High (Can be better than EBBO) | Low | Large or illiquid orders |

![A segmented, teal-hued system component with a dark blue inset, symbolizing an RFQ engine within a Prime RFQ, emerges from darkness. Illuminated by an optimized data flow, its textured surface represents market microstructure intricacies, facilitating high-fidelity execution for institutional digital asset derivatives via private quotation for multi-leg spreads](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-intelligence-layer-for-institutional-digital-asset-derivatives-rfq.jpg)

![Abstract metallic components, resembling an advanced Prime RFQ mechanism, precisely frame a teal sphere, symbolizing a liquidity pool. This depicts the market microstructure supporting RFQ protocols for high-fidelity execution of digital asset derivatives, ensuring capital efficiency in algorithmic trading](https://options.greeks.live/wp-content/uploads/2025/07/precision-engineered-institutional-digital-asset-derivatives-prime-os-architecture-driving-rfq-protocol-execution-and-capital-efficiency-optimization.jpg)

## Execution

The execution of a quantitative best execution framework for Systematic Internalisers is an operational discipline. It involves translating the firm’s strategic policy into a concrete, repeatable, and auditable process of data analysis and reporting. This process must be systematic, leveraging technology to automate data capture and analysis while enabling human oversight to interpret the results and refine the execution strategy. The ultimate goal is to create a closed-loop system where post-trade analysis directly informs pre-trade decisions.

![The image depicts two intersecting structural beams, symbolizing a robust Prime RFQ framework for institutional digital asset derivatives. These elements represent interconnected liquidity pools and execution pathways, crucial for high-fidelity execution and atomic settlement within market microstructure](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-cross-market-execution-architecture-for-digital-assets.jpg)

## The Operational Playbook for SI Trade Analysis

A firm must establish a clear, step-by-step procedure for analyzing every trade executed with an SI. This process should be integrated into the firm’s daily operational workflow and form the basis of its periodic regulatory reporting.

- **Data Ingestion and Normalization** ▴ The first step is to automatically pull together all the required data points for each SI execution. This involves consolidating trade records from the EMS/OMS, quote data from the SI (often via FIX messages), and [market data](https://prime.greeks.live/area/market-data/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) from a consolidated feed provider. All timestamps must be synchronized to a common clock, typically GPS or PTP, as required by MiFID II.

- **Benchmark Calculation** ▴ For each trade, the system must calculate the relevant benchmarks. This means querying the historical market data to retrieve the exact state of the EBBO at the precise millisecond of execution.

- **Quantitative Metric Computation** ▴ With the trade data and benchmarks in place, the system computes the core performance metrics. This includes Price Improvement (PI) versus the relevant side of the EBBO, slippage versus Arrival Price, and spread capture versus the EBBO midpoint.

- **Exception Reporting** ▴ The system should automatically flag any trades that fail to meet predefined quality thresholds. For example, any trade executed at a price worse than the EBBO, or with significant negative slippage, should be flagged for immediate review by the trading desk and compliance function.

- **Aggregation and Reporting** ▴ On a periodic basis (e.g. monthly or quarterly), the individual trade data is aggregated to produce summary reports. These reports, which mirror the logic of [RTS 28](https://prime.greeks.live/area/rts-28/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), provide a high-level view of the execution quality provided by each SI and allow for comparison against other execution venues.

![A complex, multi-faceted crystalline object rests on a dark, reflective base against a black background. This abstract visual represents the intricate market microstructure of institutional digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-prime-os-execution-architecture.jpg)

## How Should a Firm Structure Its Quantitative Analysis?

The [quantitative analysis](https://prime.greeks.live/area/quantitative-analysis/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) must be structured to answer the fundamental question ▴ did this SI provide the best possible result for the client? This is achieved through detailed [Transaction Cost Analysis](https://prime.greeks.live/area/transaction-cost-analysis/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) (TCA) that focuses on direct, measurable comparisons.

> A granular TCA dashboard provides the definitive evidence of execution quality, comparing every SI trade against the available market alternative.

The following table illustrates a simplified TCA dashboard for analyzing a series of trades routed to an SI. This level of detail provides the raw data for proving best execution.

| Trade ID | Asset | Size | SI Exec Price | EBBO at Exec (Bid/Ask) | Price Improvement (EUR) | Slippage vs Arrival (bps) | Venue Analysis |
| --- | --- | --- | --- | --- | --- | --- | --- |
| A123 | VOD.L | 50,000 | 105.51p | 105.50p / 105.52p | €5.00 | -1.5 bps | Executed within spread, 0.01p better than best offer |
| B456 | BAYN.DE | 10,000 | €52.14 | €52.13 / €52.15 | €10.00 | +0.5 bps | Executed at midpoint, providing half-spread savings |
| C789 | SAN.MC | 100,000 | €4.322 | €4.321 / €4.323 | €100.00 | -2.1 bps | Executed within spread, 0.001€ better than best offer |
| D012 | AIR.PA | 5,000 | €130.78 | €130.78 / €130.82 | €0.00 | -5.3 bps | Executed at best offer, no price improvement |

This analysis provides the tangible evidence required. For trades A123, B456, and C789, the firm can clearly demonstrate that the SI provided a better price than was publicly available. For trade D012, while there was no price improvement, the firm can demonstrate that the execution was no worse than the public market and may have been justified by other factors like size and low market impact, which must be documented in the qualitative assessment.

![Sharp, intersecting metallic silver, teal, blue, and beige planes converge, illustrating complex liquidity pools and order book dynamics in institutional trading. This form embodies high-fidelity execution and atomic settlement for digital asset derivatives via RFQ protocols, optimized by a Principal's operational framework](https://options.greeks.live/wp-content/uploads/2025/07/institutional-grade-digital-asset-derivatives-market-microstructure-high-fidelity-execution-across-multi-leg-spread-rfq-protocol-orchestration-within-principals-operational-framework.jpg)

## System Integration and Technological Architecture

Delivering this level of quantitative proof requires a sophisticated technological architecture. It is insufficient to rely on manual spreadsheets or disparate data sources. A truly robust system involves the seamless integration of several key components:

- **Execution Management System (EMS)** ▴ The EMS must be configured to log every child order and execution with high-precision timestamps. It should also be capable of routing RFQs to SIs and capturing the quote responses electronically.

- **Market Data Infrastructure** ▴ The firm needs access to a high-quality, consolidated European market data feed. This data must be stored in a tick database that can be queried efficiently to reconstruct the state of the market at any point in time.

- **TCA Engine** ▴ A dedicated [Transaction Cost](https://prime.greeks.live/area/transaction-cost/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) Analysis engine is required to automate the process of fetching trade and market data, performing the calculations, and generating the reports and dashboards illustrated above.

- **Compliance and Reporting Tools** ▴ The output of the TCA engine should feed directly into the firm’s compliance systems to support the generation of regulatory reports (like the RTS 28 summary) and to provide an auditable trail for regulators.

This integrated system forms the operational backbone of the best execution process. It ensures that the proof is not an occasional, manual exercise but a continuous, automated, and integral part of the firm’s trading workflow.

![Three sensor-like components flank a central, illuminated teal lens, reflecting an advanced RFQ protocol system. This represents an institutional digital asset derivatives platform's intelligence layer for precise price discovery, high-fidelity execution, and managing multi-leg spread strategies, optimizing market microstructure](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-for-optimal-execution.jpg)

## References

- Angel, James J. and Douglas M. McCabe. “Best execution in a fragmented market.” Journal of Trading 8.3 (2013) ▴ 59-69.

- Comerton-Forde, Carole, Vincent Grégoire, and Zhuo Zhong. “Informed trading and the cost of a quote.” Journal of Financial and Quantitative Analysis 54.2 (2019) ▴ 547-577.

- European Securities and Markets Authority. “MiFID II and MiFIR.” ESMA, 2017.

- Foucault, Thierry, Marco Pagano, and Ailsa Röell. Market liquidity ▴ theory, evidence, and policy. Oxford University Press, 2013.

- Gomber, Peter, et al. “High-frequency trading.” Goethe University Frankfurt, Working Paper (2011).

- Hautsch, Nikolaus, and Ruihong Huang. “The market impact of a limit order.” Journal of Financial Markets 15.2 (2012) ▴ 119-144.

- Lehalle, Charles-Albert, and Sophie Laruelle, eds. Market microstructure in practice. World Scientific, 2018.

- Madhavan, Ananth. “Market microstructure ▴ A survey.” Journal of financial markets 3.3 (2000) ▴ 205-258.

- O’Hara, Maureen. Market microstructure theory. Blackwell Publishing, 1995.

- UK Financial Conduct Authority. “Best execution and payment for order flow.” FCA Handbook, COBS 11.2, 2018.

![Two distinct components, beige and green, are securely joined by a polished blue metallic element. This embodies a high-fidelity RFQ protocol for institutional digital asset derivatives, ensuring atomic settlement and optimal liquidity](https://options.greeks.live/wp-content/uploads/2025/07/institutional-rfq-protocol-for-digital-asset-derivatives-high-fidelity-link.jpg)

## Reflection

![Angular metallic structures precisely intersect translucent teal planes against a dark backdrop. This embodies an institutional-grade Digital Asset Derivatives platform's market microstructure, signifying high-fidelity execution via RFQ protocols](https://options.greeks.live/wp-content/uploads/2025/07/digital-asset-derivatives-rfq-high-fidelity-execution-system-architecture.jpg)

## Is Your Data Architecture a Source of Proof or a Source of Liability?

The framework detailed here provides a methodology for constructing quantitative proof of best execution. The exercise of building this capability, however, reveals a deeper truth about a firm’s operational readiness. The ability to perform this analysis is a direct reflection of the sophistication of its underlying data and technology infrastructure. A firm that struggles to gather and synchronize the necessary data is not merely facing a reporting challenge; it is operating with a significant blind spot in its execution strategy.

Consider the systems currently in place within your own organization. Can you, with certainty, reconstruct the full European order book for any given millisecond in the past quarter? Can you automatically link every child execution from an SI back to its parent order and the precise market state at the time of the routing decision?

The answers to these questions determine whether your firm’s best execution policy is a living, data-driven process or a static document. The capacity for rigorous, quantitative proof is the ultimate measure of a firm’s command over its own execution process.

![Sleek, modular system component in beige and dark blue, featuring precise ports and a vibrant teal indicator. This embodies Prime RFQ architecture enabling high-fidelity execution of digital asset derivatives through bilateral RFQ protocols, ensuring low-latency interconnects, private quotation, institutional-grade liquidity, and atomic settlement](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-rfq-system-interface-for-digital-asset-derivatives-execution.jpg)

## Glossary

<a href="https://prime.greeks.live/area/systematic-internaliser/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Precision-engineered modular components display a central control, data input panel, and numerical values on cylindrical elements. This signifies an institutional Prime RFQ for digital asset derivatives, enabling RFQ protocol aggregation, high-fidelity execution, algorithmic price discovery, and volatility surface calibration for portfolio margin](https://options.greeks.live/wp-content/uploads/2025/07/firm-fx-options-rfq-trade-system-key-microstructure-data-flow-core-engine.jpg)

## Systematic Internaliser

Meaning ▴ A Systematic Internaliser (SI) is a financial institution executing client orders against its own capital on an organized, frequent, systematic basis off-exchange. </a><a href="https://prime.greeks.live/area/best-execution/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A transparent central hub with precise, crossing blades symbolizes institutional RFQ protocol execution. This abstract mechanism depicts price discovery and algorithmic execution for digital asset derivatives, showcasing liquidity aggregation, market microstructure efficiency, and best execution](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-platform-microstructure.jpg)

## Best Execution

Meaning ▴ Best Execution is the obligation to obtain the most favorable terms reasonably available for a client's order. </a><a href="https://prime.greeks.live/area/price-improvement/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Polished, intersecting geometric blades converge around a central metallic hub. This abstract visual represents an institutional RFQ protocol engine, enabling high-fidelity execution of digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocols-high-fidelity-execution-market-microstructure.jpg)

## Price Improvement

Meaning ▴ Price improvement denotes the execution of a trade at a more advantageous price than the prevailing National Best Bid and Offer (NBBO) at the moment of order submission. </a><a href="https://prime.greeks.live/area/market-impact/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Abstractly depicting an Institutional Grade Crypto Derivatives OS component. Its robust structure and metallic interface signify precise Market Microstructure for High-Fidelity Execution of RFQ Protocol and Block Trade orders](https://options.greeks.live/wp-content/uploads/2025/07/principals-integrated-crypto-derivatives-rfq-protocol-architecture.jpg)

## Market Impact

Meaning ▴ Market Impact refers to the observed change in an asset's price resulting from the execution of a trading order, primarily influenced by the order's size relative to available liquidity and prevailing market conditions. </a><a href="https://prime.greeks.live/area/central-limit-order-book/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A translucent, faceted sphere, representing a digital asset derivative block trade, traverses a precision-engineered track. This signifies high-fidelity execution via an RFQ protocol, optimizing liquidity aggregation, price discovery, and capital efficiency within institutional market microstructure](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-block-trade-high-fidelity-execution-protocol-prime-os-path.jpg)

## Central Limit Order Book

Meaning ▴ A Central Limit Order Book is a digital repository that aggregates all outstanding buy and sell orders for a specific financial instrument, organized by price level and time of entry. </a><a href="https://prime.greeks.live/area/rfq/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![An abstract geometric composition depicting the core Prime RFQ for institutional digital asset derivatives. Diverse shapes symbolize aggregated liquidity pools and varied market microstructure, while a central glowing ring signifies precise RFQ protocol execution and atomic settlement across multi-leg spreads, ensuring capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-execution-architecture.jpg)

## Rfq

Meaning ▴ Request for Quote (RFQ) is a structured communication protocol enabling a market participant to solicit executable price quotations for a specific instrument and quantity from a selected group of liquidity providers. </a><a href="https://prime.greeks.live/area/order-execution-policy/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A central, metallic cross-shaped RFQ protocol engine orchestrates principal liquidity aggregation between two distinct institutional liquidity pools. Its intricate design suggests high-fidelity execution and atomic settlement within digital asset options trading, forming a core Crypto Derivatives OS for algorithmic price discovery](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-architecture-optimizing-liquidity-aggregation-and-high-fidelity-execution.jpg)

## Order Execution Policy

Meaning ▴ An Order Execution Policy defines the systematic procedures and criteria governing how an institutional trading desk processes and routes client or proprietary orders across various liquidity venues. </a><a href="https://prime.greeks.live/area/mifid-ii/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Sleek, futuristic metallic components showcase a dark, reflective dome encircled by a textured ring, representing a Volatility Surface for Digital Asset Derivatives. This Prime RFQ architecture enables High-Fidelity Execution and Private Quotation via RFQ Protocols for Block Trade liquidity](https://options.greeks.live/wp-content/uploads/2025/07/advanced-institutional-digital-asset-derivatives-platform-architecture-for-high-fidelity-rfq-protocol-execution-and-price-discovery.jpg)

## Mifid Ii

Meaning ▴ MiFID II, the Markets in Financial Instruments Directive II, constitutes a comprehensive regulatory framework enacted by the European Union to govern financial markets, investment firms, and trading venues. </a><a href="https://prime.greeks.live/question/how-does-encrypted-communication-in-rfq-systems-affect-regulatory-compliance-and-best-execution-proof/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A polished, light surface interfaces with a darker, contoured form on black. This signifies the RFQ protocol for institutional digital asset derivatives, embodying price discovery and high-fidelity execution](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-interface.jpg)

## Quantitative Proof

Encrypted RFQ systems reconcile client confidentiality with regulatory proof via an architecture that generates immutable, internal audit trails. </a><a href="https://prime.greeks.live/area/ebbo/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Polished metallic surface with a central intricate mechanism, representing a high-fidelity market microstructure engine. Two sleek probes symbolize bilateral RFQ protocols for precise price discovery and atomic settlement of institutional digital asset derivatives on a Prime RFQ, ensuring best execution for Bitcoin Options](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-institutional-digital-asset-derivatives-rfq-engine-core-market-microstructure-intelligence-layer.jpg)

## Ebbo

Meaning ▴ EBBO, or Exchange Best Bid and Offer, denotes the highest bid price and the lowest offer price currently available on a single, specific trading venue. </a><a href="https://prime.greeks.live/area/execution-quality/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A curved grey surface anchors a translucent blue disk, pierced by a sharp green financial instrument and two silver stylus elements. This visualizes a precise RFQ protocol for institutional digital asset derivatives, enabling liquidity aggregation, high-fidelity execution, price discovery, and algorithmic trading within market microstructure via a Principal's operational framework](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-high-fidelity-execution-via-rfq-protocols-optimizing-market-microstructure-and-price-discovery.jpg)

## Execution Quality

Meaning ▴ Execution Quality quantifies the efficacy of an order's fill, assessing how closely the achieved trade price aligns with the prevailing market price at submission, alongside consideration for speed, cost, and market impact. </a><a href="https://prime.greeks.live/area/execution-policy/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A luminous, multi-faceted geometric structure, resembling interlocking star-like elements, glows from a circular base. This represents a Prime RFQ for Institutional Digital Asset Derivatives, symbolizing high-fidelity execution of block trades via RFQ protocols, optimizing market microstructure for price discovery and capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-system.jpg)

## Execution Policy

Meaning ▴ An Execution Policy defines a structured set of rules and computational logic governing the handling and execution of financial orders within a trading system. </a><a href="https://prime.greeks.live/area/order-book/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Precision-engineered multi-layered architecture depicts institutional digital asset derivatives platforms, showcasing modularity for optimal liquidity aggregation and atomic settlement. This visualizes sophisticated RFQ protocols, enabling high-fidelity execution and robust pre-trade analytics](https://options.greeks.live/wp-content/uploads/2025/08/modular-digital-asset-derivative-prime-os-for-institutional-rfq-and-block-trade-execution.jpg)

## Order Book

Meaning ▴ An Order Book is a real-time electronic ledger detailing all outstanding buy and sell orders for a specific financial instrument, organized by price level and sorted by time priority within each level. </a><a href="https://prime.greeks.live/area/market-data/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Intersecting transparent and opaque geometric planes, symbolizing the intricate market microstructure of institutional digital asset derivatives. Visualizes high-fidelity execution and price discovery via RFQ protocols, demonstrating multi-leg spread strategies and dark liquidity for capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-market-microstructure-architecture.jpg)

## Market Data

Meaning ▴ Market Data comprises the real-time or historical pricing and trading information for financial instruments, encompassing bid and ask quotes, last trade prices, cumulative volume, and order book depth. </a><a href="https://prime.greeks.live/area/rts-28/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Precision cross-section of an institutional digital asset derivatives system, revealing intricate market microstructure. Toroidal halves represent interconnected liquidity pools, centrally driven by an RFQ protocol](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-prime-os-architecture-revealing-precision-rfq-protocol-engine-for-optimal-high-fidelity-execution-and-latent-liquidity-aggregation.jpg)

## Rts 28

Meaning ▴ RTS 28 refers to Regulatory Technical Standard 28 under MiFID II, which mandates investment firms and market operators to publish annual reports on the quality of execution of transactions on trading venues and for financial instruments. </a><a href="https://prime.greeks.live/area/transaction-cost-analysis/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Two intertwined, reflective, metallic structures with translucent teal elements at their core, converging on a central nexus against a dark background. This represents a sophisticated RFQ protocol facilitating price discovery within digital asset derivatives markets, denoting high-fidelity execution and institutional-grade systems optimizing capital efficiency via latent liquidity and smart order routing across dark pools](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-rfq-execution-system-architecture.jpg)

## Transaction Cost Analysis

Meaning ▴ Transaction Cost Analysis (TCA) is the quantitative methodology for assessing the explicit and implicit costs incurred during the execution of financial trades. </a><a href="https://prime.greeks.live/area/quantitative-analysis/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Two spheres balance on a fragmented structure against split dark and light backgrounds. This models institutional digital asset derivatives RFQ protocols, depicting market microstructure, price discovery, and liquidity aggregation](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocols-price-discovery-liquidity-aggregation.jpg)

## Quantitative Analysis

Meaning ▴ Quantitative Analysis involves the application of mathematical, statistical, and computational methods to financial data for the purpose of identifying patterns, forecasting market movements, and making informed investment or trading decisions. </a><a href="https://prime.greeks.live/area/transaction-cost/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Diagonal composition of sleek metallic infrastructure with a bright green data stream alongside a multi-toned teal geometric block. This visualizes High-Fidelity Execution for Digital Asset Derivatives, facilitating RFQ Price Discovery within deep Liquidity Pools, critical for institutional Block Trades and Multi-Leg Spreads on a Prime RFQ](https://options.greeks.live/wp-content/uploads/2025/07/high-fidelity-digital-asset-derivatives-rfq-execution-optimization-leveraging-proprietary-institutional-prime-os-for-optimal-price-discovery-and-latency-reduction.jpg)

## Transaction Cost

Meaning ▴ Transaction Cost represents the total quantifiable economic friction incurred during the execution of a trade, encompassing both explicit costs such as commissions, exchange fees, and clearing charges, alongside implicit costs like market impact, slippage, and opportunity cost. </a>

**Tags:** [RTS 28](https://options.greeks.live/area/rts-28/), [Systematic Internaliser](https://options.greeks.live/area/systematic-internaliser/), [Market Microstructure](https://options.greeks.live/area/market-microstructure/), [Order Book](https://options.greeks.live/area/order-book/), [Order Execution Policy](https://options.greeks.live/area/order-execution-policy/), [Execution Quality](https://options.greeks.live/area/execution-quality/)	

## Discover More

- 
### [How Do Regulatory Frameworks like MiFID II Influence the Use of RFQ for Best Execution?](https://options.greeks.live/question/how-do-regulatory-frameworks-like-mifid-ii-influence-the-use-of-rfq-for-best-execution/)
![A metallic, cross-shaped mechanism centrally positioned on a highly reflective, circular silicon wafer. The surrounding border reveals intricate circuit board patterns, signifying the underlying Prime RFQ and intelligence layer. This setup symbolizes high-fidelity execution within market microstructure, enabling algorithmic trading for institutional-grade digital asset derivatives and RFQ protocols with atomic settlement.](https://options.greeks.live/wp-content/uploads/2025/08/the-core-institutional-digital-asset-derivatives-rfq-os-engine-for-high-fidelity-market-microstructure.jpg)

MiFID II transforms the RFQ into a data-driven, auditable process, mandating a systematic approach to proving best execution.

- 
### [How Does the Systematic Internaliser Regime Affect Best Execution Obligations for the Buy-Side?](https://options.greeks.live/question/how-does-the-systematic-internaliser-regime-affect-best-execution-obligations-for-the-buy-side/)
![The central teal core signifies a Principal's Prime RFQ, routing RFQ protocols across modular arms. Metallic levers denote precise control over multi-leg spread execution and block trades. This framework ensures high-fidelity execution, optimal price discovery, and efficient management of latent liquidity for institutional digital asset derivatives.](https://options.greeks.live/wp-content/uploads/2025/07/principals-prime-os-rfq-system-institutional-digital-asset-derivatives.jpg)

The Systematic Internaliser regime integrates a principal-based, regulated liquidity source into the market, demanding a data-driven evolution of buy-side execution frameworks to prove best execution.

- 
### [How Can a Firm Quantitatively Prove That Its RFQ Process Achieves Best Execution Consistently?](https://options.greeks.live/question/how-can-a-firm-quantitatively-prove-that-its-rfq-process-achieves-best-execution-consistently/)
![An intricate, transparent cylindrical system depicts a sophisticated RFQ protocol for digital asset derivatives. Internal glowing elements signify high-fidelity execution and algorithmic trading. A central angular structure represents atomic settlement and multi-leg spread capabilities, ensuring best execution within institutional trading.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-protocol-architecture.jpg)

A firm proves RFQ best execution by building a data architecture that systematically benchmarks every trade against the available market.

- 
### [How Do Best Execution Obligations Differ between Systematic Internalisers and Mtfs?](https://options.greeks.live/question/how-do-best-execution-obligations-differ-between-systematic-internalisers-and-mtfs/)
![A precision-engineered metallic cross-structure, embodying an RFQ engine's market microstructure, showcases diverse elements. One granular arm signifies aggregated liquidity pools and latent liquidity. The opposing perforated arm represents high-fidelity execution and algorithmic trading parameters. Its central pivot symbolizes atomic settlement within institutional digital asset derivatives.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-rfq-engine-microstructure-for-atomic-settlement.jpg)

Systematic Internalisers and MTFs possess distinct best execution duties rooted in their core operational models—bilateral principal versus multilateral agency—shaping strategic liquidity access.

- 
### [How Does the Systematic Internaliser Regime Impact the Price Discovery Process in Financial Markets?](https://options.greeks.live/question/how-does-the-systematic-internaliser-regime-impact-the-price-discovery-process-in-financial-markets/)
![Luminous central hub intersecting two sleek, symmetrical pathways, symbolizing a Principal's operational framework for institutional digital asset derivatives. Represents a liquidity pool facilitating atomic settlement via RFQ protocol streams for multi-leg spread execution, ensuring high-fidelity execution within a Crypto Derivatives OS.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-execution-pathways-optimized.jpg)

The Systematic Internaliser regime re-architects liquidity pathways, trading off centralized transparency for bilateral execution efficiency.

- 
### [What Are the Primary Differences in Best Execution Reporting for a CLOB versus an RFQ Trade?](https://options.greeks.live/question/what-are-the-primary-differences-in-best-execution-reporting-for-a-clob-versus-an-rfq-trade/)
![An advanced digital asset derivatives system features a central liquidity pool aperture, integrated with a high-fidelity execution engine. This Prime RFQ architecture supports RFQ protocols, enabling block trade processing and price discovery. It manages multi-leg spreads and optimizes portfolio margin through quantitative analysis for alpha generation.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-rfq-protocol-execution-system-architecture.jpg)

Best execution reporting for a CLOB is a quantitative audit of public data; for an RFQ, it's a qualitative defense of a private process.

- 
### [How Does MiFID II Differentiate Best Execution for RFQ and CLOB Systems?](https://options.greeks.live/question/how-does-mifid-ii-differentiate-best-execution-for-rfq-and-clob-systems/)
![Two smooth, teal spheres, representing institutional liquidity pools, precisely balance a metallic object, symbolizing a block trade executed via RFQ protocol. This depicts high-fidelity execution, optimizing price discovery and capital efficiency within a Principal's operational framework for digital asset derivatives.](https://options.greeks.live/wp-content/uploads/2025/07/precision-execution-bridging-institutional-liquidity-pools-via-rfq-protocol-for-optimized-digital-asset-derivatives-price-discovery.jpg)

MiFID II mandates a bifurcated best execution analysis, assessing CLOBs on post-trade data against public benchmarks and RFQs on the integrity of the private price discovery process.

- 
### [How Does MiFID II Change the Evidentiary Burden for Asset Managers?](https://options.greeks.live/question/how-does-mifid-ii-change-the-evidentiary-burden-for-asset-managers/)
![A transparent, multi-faceted component, indicative of an RFQ engine's intricate market microstructure logic, emerges from complex FIX Protocol connectivity. Its sharp edges signify high-fidelity execution and price discovery precision for institutional digital asset derivatives. This Prime RFQ module optimizes algorithmic trading and capital efficiency.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-engine-optimized-for-best-execution.jpg)

MiFID II transforms the evidentiary burden into a systemic requirement to prove optimal execution outcomes through continuous data analysis.

- 
### [How Does MiFID II Influence RFQ Data Governance and Best Execution Requirements?](https://options.greeks.live/question/how-does-mifid-ii-influence-rfq-data-governance-and-best-execution-requirements/)
![A sleek, metallic mechanism symbolizes an advanced institutional trading system. The central sphere represents aggregated liquidity and precise price discovery. Its metallic arm signifies an algorithmic trading engine, facilitating high-fidelity execution for digital asset derivatives, with intricate base circuitry depicting optimized RFQ protocols and robust market microstructure.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-engine-for-optimal-price-discovery-and-best-execution.jpg)

MiFID II mandates that RFQ protocols evolve into fully auditable, data-driven systems to prove best execution for clients.

---

## Raw Schema Data

```json
{
    "@context": "https://schema.org",
    "@type": "BreadcrumbList",
    "itemListElement": [
        {
            "@type": "ListItem",
            "position": 1,
            "name": "Home",
            "item": "https://options.greeks.live"
        },
        {
            "@type": "ListItem",
            "position": 2,
            "name": "Question",
            "item": "https://options.greeks.live/question/"
        },
        {
            "@type": "ListItem",
            "position": 3,
            "name": "How Can a Firm Quantitatively Prove Best Execution When Using a Systematic Internaliser?",
            "item": "https://options.greeks.live/question/how-can-a-firm-quantitatively-prove-best-execution-when-using-a-systematic-internaliser/"
        }
    ]
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "Organization",
    "@id": "https://greeks.live/#organization",
    "name": "Greeks.Live",
    "url": "https://greeks.live/",
    "description": "Greeks.live is the definitive toolkit for the professional options trader, dedicated to empowering our users with institutional-grade data, advanced analytics, and a comprehensive suite of trading tools designed to provide a decisive edge in the market. Every article and guide published under the Greeks.live name is a product of our deep commitment to data-driven analysis and our mission to support the global trading community.",
    "email": "support@greeks.live",
    "logo": {
        "@type": "ImageObject",
        "url": "https://options.greeks.live/wp-content/uploads/2025/07/Greeks.Live-Logo-Icon.svg"
    },
    "hasPart": [
        {
            "@type": "WebSite",
            "name": "About Us",
            "url": "https://about.greeks.live"
        },
        {
            "@type": "WebSite",
            "name": "App Download Page",
            "url": "https://about.greeks.live/#/download/basic_trade"
        },
        {
            "@type": "WebSite",
            "name": "Newcomers' Guide",
            "url": "https://twisty-sign-c8b.notion.site/Guide-for-Greeks-live-X-Deribit-Newbies-5a08a3052822427d800af6eaf3704c8d"
        },
        {
            "@type": "WebSite",
            "name": "Knowledge Base",
            "url": "https://linktr.ee/greeks.live"
        },
        {
            "@type": "WebSite",
            "name": "Option Terminology",
            "url": "https://greekslive.notion.site/88dfc00e7c584d4d8969b6302a79a12f?pvs=4"
        },
        {
            "@type": "WebSite",
            "name": "Terms of Service",
            "url": "https://greeks.live/#/tos"
        },
        {
            "@type": "WebSite",
            "name": "Disclaimer",
            "url": "https://greeks.live/#/disclaimer"
        }
    ],
    "sameAs": [
        "https://x.com/greekslive",
        "https://youtube.com/@greeks_live?si=-KjT0Lkw4WUCI0tD",
        "https://t.me/greekslive_notifications",
        "https://t.me/greekslive",
        "https://pinterest.com/greekslive/"
    ],
    "makesOffer": [
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "RFQ Platform",
                "url": "https://rfq.greeks.live",
                "description": "Execute institutional-grade block trades for crypto options and futures. This platform provides deep, over-the-counter (OTC) liquidity via a professional Request for Quote system.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Lending Tools",
                "url": "https://lend.greeks.live",
                "description": "Manage crypto lending and borrowing activities to earn yield or secure loans. This suite of tools helps users analyze interest rates and manage collateralized debt positions.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Data Lab",
                "url": "https://greeks.live/#/deribit/tools/datalab/BTC",
                "description": "Analyze historical and real-time options data with advanced metrics. This tool is designed for backtesting strategies and identifying market trends through comprehensive data visualization.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Profit & Loss Analysis (PnL)",
                "url": "https://greeks.live/#/deribit/tools/pnl_analysis",
                "description": "Track and analyze the Profit and Loss (PnL) of your options portfolio. This tool provides detailed performance metrics to help traders evaluate and refine their strategies.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Position Visualization",
                "url": "https://greeks.live/#/deribit/tools/pv/BTC",
                "description": "Visualize complex options positions and their corresponding risk profiles. This tool generates payoff diagrams to help traders intuitively understand potential profit, loss, and exposure.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Options Calculator",
                "url": "https://greeks.live/#/deribit/tools/calculator",
                "description": "Calculate the theoretical price and risk parameters ('the Greeks') of crypto options. An essential tool for pricing new trades and analyzing the sensitivity of existing positions.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Greeks.live Main Platform",
                "url": "https://greeks.live/",
                "description": "The central hub for the Greeks.live suite of professional cryptocurrency options and derivatives trading tools. Access analytics, manage positions, and explore the ecosystem.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Community Forum",
                "url": "https://t.greeks.live",
                "description": "Join the official Greeks.live community. Connect with other traders, share insights, and receive the latest updates directly from the team.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Greeks.live for Deribit",
                "url": "http://deribit.greeks.live",
                "description": "A dedicated interface for trading on the Deribit exchange. This platform leverages Greeks.live's advanced analytics and tools specifically for users of Deribit's options and futures markets.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "Greeks.live for OKX",
                "url": "http://okx.greeks.live",
                "description": "A dedicated interface for trading on the OKX exchange. This platform integrates Greeks.live's powerful analytics with the OKX marketplace, focusing on its options and derivatives products.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "GLVS.AI Trading Platform",
                "url": "https://www.glvs.ai/",
                "description": "An AI-powered platform for automated crypto options trading. Leverage advanced algorithms and data-driven signals to develop and deploy sophisticated, hands-free trading strategies.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        },
        {
            "@type": "Offer",
            "itemOffered": {
                "@type": "Service",
                "name": "API Testnet & Sandbox",
                "url": "https://test.greeks.live",
                "description": "A dedicated testnet environment for developers to test their API integrations and automated trading strategies. This sandbox allows for full functionality testing without risking real funds.",
                "provider": {
                    "@id": "https://greeks.live/#organization"
                }
            }
        }
    ],
    "subOrganization": [
        {
            "@type": "Organization",
            "name": "GreeksLive HK Co., Limited",
            "email": "support@greeks.live",
            "telephone": "+852-56418949",
            "address": {
                "@type": "PostalAddress",
                "streetAddress": "Unit 11, 27/F, K. Wah Centre, 191 Java Road",
                "addressLocality": "Hong Kong",
                "addressRegion": "North Point",
                "addressCountry": "CN",
                "postalCode": "0000"
            },
            "geo": {
                "@type": "GeoCoordinates",
                "latitude": "22.2932357",
                "longitude": "114.2022026"
            },
            "image": "https://options.greeks.live/wp-content/uploads/2025/08/Wah-Centre-Hong-Kong.jpg"
        }
    ]
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "Article",
    "mainEntityOfPage": {
        "@type": "WebPage",
        "@id": "https://options.greeks.live/question/how-can-a-firm-quantitatively-prove-best-execution-when-using-a-systematic-internaliser/"
    },
    "headline": "How Can a Firm Quantitatively Prove Best Execution When Using a Systematic Internaliser? \u25b4 Question",
    "description": "Proving best execution for a Systematic Internaliser requires a data architecture that quantitatively validates bilateral trades against public market benchmarks. \u25b4 Question",
    "url": "https://options.greeks.live/question/how-can-a-firm-quantitatively-prove-best-execution-when-using-a-systematic-internaliser/",
    "datePublished": "2025-08-05T17:49:47+00:00",
    "dateModified": "2025-08-05T17:49:48+00:00",
    "articleSection": [
        "Question"
    ],
    "author": {
        "@id": "https://greeks.live/#organization"
    },
    "publisher": {
        "@id": "https://greeks.live/#organization"
    },
    "image": {
        "@type": "ImageObject",
        "url": "https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-prime-os-architecture-revealing-precision-rfq-protocol-engine-for-optimal-high-fidelity-execution-and-latent-liquidity-aggregation.jpg",
        "caption": "This abstract cross-section reveals the sophisticated market microstructure of an institutional digital asset derivatives. Dual toroidal segments symbolize aggregated liquidity pools and robust counterparty risk management. A central RFQ protocol engine orchestrates private quotation and best execution for block trades, enabling seamless multi-leg spread strategies and advanced portfolio margin calculations. This high-performance Prime RFQ architecture ensures low latency and optimal capital efficiency."
    },
    "keywords": [
        "Best Execution",
        "Central Limit Order Book",
        "Cost Analysis",
        "EBBO",
        "Execution Policy",
        "Execution Quality",
        "Execution Venue Analysis",
        "Market Data",
        "Market Impact",
        "Market Microstructure",
        "MiFID II",
        "Order Book",
        "Order Execution Policy",
        "Price Improvement",
        "Quantitative Analysis",
        "RFQ",
        "RTS 28",
        "Systematic Internaliser",
        "Transaction Cost",
        "Transaction Cost Analysis"
    ]
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "WebSite",
    "url": "https://options.greeks.live/",
    "potentialAction": {
        "@type": "SearchAction",
        "target": "https://options.greeks.live/?s=search_term_string",
        "query-input": "required name=search_term_string"
    }
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "FAQPage",
    "mainEntity": [
        {
            "@type": "Question",
            "name": "What Are The Most Effective Benchmarks For SI Execution Analysis?",
            "acceptedAnswer": {
                "@type": "Answer",
                "text": "Selecting the right benchmarks is critical for a meaningful analysis. While standard benchmarks like Volume-Weighted Average Price (VWAP) or Arrival Price have their place, they are insufficient on their own for SI analysis. The most critical benchmark is the prevailing market price on lit venues at the moment of execution. This allows for a direct, \"apples-to-apples\" comparison."
            }
        },
        {
            "@type": "Question",
            "name": "How Should A Firm Structure Its Quantitative Analysis?",
            "acceptedAnswer": {
                "@type": "Answer",
                "text": "The quantitative analysis must be structured to answer the fundamental question: did this SI provide the best possible result for the client? This is achieved through detailed Transaction Cost Analysis (TCA) that focuses on direct, measurable comparisons."
            }
        },
        {
            "@type": "Question",
            "name": "Is Your Data Architecture A Source Of Proof Or A Source Of Liability?",
            "acceptedAnswer": {
                "@type": "Answer",
                "text": "The framework detailed here provides a methodology for constructing quantitative proof of best execution. The exercise of building this capability, however, reveals a deeper truth about a firm's operational readiness. The ability to perform this analysis is a direct reflection of the sophistication of its underlying data and technology infrastructure. A firm that struggles to gather and synchronize the necessary data is not merely facing a reporting challenge; it is operating with a significant blind spot in its execution strategy."
            }
        }
    ]
}
```


---

**Original URL:** https://options.greeks.live/question/how-can-a-firm-quantitatively-prove-best-execution-when-using-a-systematic-internaliser/
