What Are Market Data Display Agreements

By on July 25, 2023

Market data display agreements, commonly known as MDDAs, are legal agreements between financial market data vendors and their clients. These agreements outline the terms and conditions related to the distribution of market data to the clients and the fees and other charges that the vendors can impose.

The MDDAs are predominantly used in the financial services industry, especially in stock exchanges, where real-time data feeds provide up-to-date information about market prices and trends to clients, including retail investors, institutional investors, and other market participants. These data feeds comprise a vast amount of information, including quotes, trade data, order book updates, and other financial data.

The MDDAs govern the distribution of such data feeds to clients, and they are critical in ensuring that data vendors can exert control over the usage, distribution, and display of their data. The agreements typically specify the types of clients who are eligible to receive the data feeds, the permitted uses of the data, and the pricing structure for access to the data.

In addition to regulating the distribution of data, MDDAs also include provisions related to data display. These provisions dictate how the clients can display the market data on their trading platforms, websites, and other applications. For instance, the agreements may specify the maximum delay that clients can introduce in the display of the data, the permitted display formats, and the methods for attributing the source of the data.

One of the critical benefits of MDDAs is that they help ensure the integrity and accuracy of market data. The agreements typically require data vendors to maintain high-quality standards for their data feeds, including timely updates and accurate information.

In conclusion, market data display agreements play a crucial role in the financial markets by regulating the distribution and display of market data. By outlining the terms and conditions for accessing and using market data, these agreements help ensure that clients can access trustworthy and accurate information and that vendors can assert control over the usage and distribution of their data.