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The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

Talking Intelligent Trading Technology with Andrew Delaney: Getting Smart About Trading

Welcome to 2014, and the launch in earnest of IntelligentTradingTechnology.com.

As of today, I’ll be your host and editor as we explore how the convergence of high-performance technologies for low-latency trading and the emerging hunger for Big Data-type solutions converge to create the kinds of analytics heretofore unavailable to the pre-trade and at-trade environments.

I say explore because we believe the marketplace is at an exciting juncture that brings together many of the capabilities we’ve been tracking over the past eight years via Low-Latency.com with emerging technologies like in-memory databases, NoSQL and the various flavours of the Hadoop/MapReduce methodologies. And like everyone else, we don’t yet know where this convergence is going to take us.

What we do know is that a new level playing field of sorts has emerged. Low latency connectivity is no longer a niche activity; for many market leaders, it’s mainstream – you can no longer afford to operate without it.

That eliminates the competitive advantage – except for a very small number of players in the ultra low latency space – of being fast. And so we swing back to smarts. Hence: Intelligent trading.

We see that smarts as being characterized by packing as much ‘intelligence’ as is manageably possible into the pre-trade decision. That intelligence may take the form of market information, from new sources like social media and machine-readable news. It could take the form of so-called adaptive algorithms, which generate orders based on up-to-the-moment modifications of their view of the market, or the cost of trading in this market or that, or the cost of clearing through this clearer or another.

This intelligence might delve deeper into the enterprise. It could be calculating pre-trade risk, based on market, counterparty or liquidity-based parameters. It might search across a firm’s global operations to identify the best way of putting together a given complex transaction. Or it may check across multiple regulatory environments to find the best place to meet a client’s specific needs, based on that client’s specific circumstances.

In each case, access to large amounts of data and speed of processing will be major components of a successful strategy. We are excited by the possibilities. As it says on the tin: IntelligentTradingTechnology.com will be all about low latency, big data and analytics.

We’ll be charting the path of these exciting developments in the electronic ‘pages’ of IntelligentTradingTechnology.com, and through our ongoing series of webinars and the newly relabelled Intelligent Trading Summit conferences. We kick off with our first Intelligent Trading Summits in London on March 4 and in New York on May 13. Get in touch if you’re interested in getting involved.

To whet your appetite on our future direction, I would recommend downloading Tibco Software’s white paper on the topic written by Pete Harris, who’ll remain as contributor to IntelligentTradingTechnology.com. For a very specific example of how we see historically low latency technology being redeployed to provide ‘intelligence’ of a new kind, I’d also recommend this analysis of Corvil’s incursion into the operational risk space, written by Sarah Underwood, who’ll be helping me in our coverage of this space.

We hope you join us on this voyage of discovery. We believe the possibilities for our marketplace are about to step up a notch, toward a more proactive and rewarding approach to trading after perhaps five years of reacting to the restrictive ‘troika’ of risk, rules and regulation.

Buckle up. It’s gonna be quite a ride.

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