Once upon a time, cutting market data costs was easy. That’s because – and you’ve all seen the photo – traders took every service from every supplier, and each service needed a discrete telecommunications line. The result was an unwieldy – even messy – trading desk that was tricky to make use of and hugely expensive to operate.
Special Report: Market Data Cost Containment
Special Report: Direct Data Feed Services
Direct exchange feeds – and real-time data feeds generated by alternative trading systems – have entered the realm of mainstream for today’s most demanding trading environments. By sidestepping the aggregation and normalisation process required for consolidated data feeds, direct feeds offer the fastest possible access to rapidly updating market prices, used by high frequency traders and other alpha seekers to drive their trading models.
Special Report: Connecting to Today’s Fast Markets
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Low latency connectivity has enjoyed a resurgence of interest as high-performance trading architectures become a reality. Early interest in the low-latency ‘vision’ may have been interrupted by the global financial crisis, but no matter: low latency is back, and providing the catalyst for the explosion in high frequency trading.
As liquidity continues to fragment – in the US and globally – electronic trading operations are demanding connectivity to a broader array of execution venues. As well as traditional exchanges, traders today need access to alternative trading systems, including electronic communications networks, dark pools and multilateral trading facilities (MTFs). Securing and maintaining a robust, high-performance connectivity solution is key to providing comprehensive market access.
Performance and Efficiency: How a Managed Services Approach Can Ease Your Market Data Headache
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Market infrastructure is evolving at a pace that even the most technology-savvy financial institutions find challenging. New execution venues are popping up everywhere fragmenting liquidity and creating cross-dependencies between primary and derivative marketplaces. The move to fast markets and trading automation is cutting response times and increasing data volumes. Markets have shown a 70% increase in volume over the last year alone.
Update latencies of less than 10 microseconds are now possible — even commonplace. Market data rates in excess of 20 billion update messages per day are on the near horizon. With a universe of more than 250 real-time markets trading in excess of 40 million instruments and derivatives, developing and delivering a market data system for today’s markets is, at best, problematic.
Never before have financial institutions faced a more pressing need for flexible data acquisition solutions. And the requirement applies across the board: From the largest tier 1, bulge bracket firms, to the pluckiest speciality execution firm, firms of all shapes and sizes are seeing the market data management requirement leap to the top of their priority lists.
New Approaches to Modern Trading Room Design
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In today’s financial markets, trading firms face constant pressures in a fiercely competitive environment. Providing best execution and superlative customer service is fundamental to attracting order flow. Running trading operations efficiently is also an imperative, to minimise costs internally and to offer best value to customers. Despite the increase in recent years of automated and algorithmic trading, the human touch is as important as ever in financial trading. Traders bring a wealth of experience to the art of trading, even when it is driven by computer-generated indicators. Their experience and relationships are vital to seeking out liquidity and efficient execution.
Trading operations overall need to be agile and flexible in order to meet ever changing demands and to rapidly exploit business opportunities. The regrouping of traders to react to – even pre-empt – market demand, requires trading positions that can be immediately configured to individual trader’s preference and information needs. At the same time, management and operational costs of trading operations need to be driven down in reaction to the ever downward pressure on margins. Whether costs are reduced through sharing of information services, through a reduction in maintenance costs, or change management costs, it all adds to the bottom line.
Special Report: Market Data - Methods for Managing Costs
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It’s said that market data is the lifeblood of financial markets. Today, there’s more of it than ever before, and it’s delivered at sub-millisecond rates. It’s an important resource that needs an increasingly important resource to manage it.
But it’s also said to be the second-highest cost item for market participants after payroll. Needless to say, with costs everywhere under scrutiny, even market data can’t escape the attention of the bean-counters.
Market data managers are facing an impossible trade-off: how to do more, with less. Or are they?
This special report examines how to keep the lid on market data costs, even as timely and comprehensive information becomes more important to a market practitioner’s ability to perform.
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