Capital Markets & the ‘trading smart’ paradigm
‘What does the future of Capital Markets infrastructure and technology development hold?’ was the ambitious topic of a panel discussion recently held by Colt. Chaired by the CEO and cofounder of data analytics provider big xyt, the panel consisted of representatives from Applied Blockchain, AWS, CME Group and Colt Capital Markets.
Whereas in the past, the trading race has focused heavily on speed, today’s race is centred on market data and intelligence. While the race to achieve the lowest latency triggered by the prominence of algo trading isn’t necessarily over, we’re now seeing a growing preoccupation with smart versus fast. Cloud computing, artificial intelligence (AI), machine learning, and big data – are all coming together to allow participants to infer new meaning from data and automate decisions in a smarter way to allow strategic gains.
Blockchain is another emerging area that is making an impact on how data is sourced, stored and shared in the finance industry. More and more applications based on distributed ledger technologies are added to the cloud every day, but they are also gaining ground as private solutions, where the benefits around auditing, traceability and transparency are leveraged by consortiums of firms in private chains. Here, again, there is a demand for flexible capacity and secure sharing in developing and deploying Blockchain solutions to enable smarter decision-making.
This paradigm shift to smart has clearly increased demand for greater computational capacity, a demand for which the cloud is a natural partner. Security has historically hindered the migration of financial firms to the cloud but, while it is still job zero for these firms, adoption is demanding a change in approach to how firms look at security on the whole. While security had largely been viewed as a hard exterior, moving to the cloud is encouraging firms to take a micro-segmentation approach, against all threat factors internally as well as externally, and large cloud providers are able to provide the toolbox to do so.
As powerful a tool as it is, the cloud is only as smart as the network connecting to it. Firms need a smart way to access their tools and alternative market data sets – that’s where the Colt PrizmNet ecosystem comes in. Unlike the public internet, the financial extranet is able to provide flexible, deterministic in/out connectivity to the cloud and a wider intelligent ecosystem, where multiple, diverse services can be accessed. This connected ecosystem allows firms to shift their focus away from the technologies themselves to the intelligence available to them.
Terence Chabe is Business Development Manager – Capital Markets, at Colt