By OJ Shannon, Marketing Manager, ITRS Group

Post-crisis regulation coupled with cyclical and structural changes, like Swap Execution Facilities (SEFs), means financial services businesses are having to rethink how they capture and leverage data to remain profitable and relevant in an ever-changing landscape.

To meet these challenges, firms are fast turning to big data analytics frameworks that are capable of handling large volumes and varieties of data and producing real-time or ‘perishable’ insights, which can be acted upon before the value of the information goes stale. This is not to say more traditional analytics or business intelligence (BI), typically gleaned from historical datasets, is any less important, however. Hence, big data tools need significant storage capability too.

With the advent of such technology and profound changes to market structure (referenced briefly above), the line between the sell-side and buy-side is blurring. Previously, the buy-side took a longer term view of assets and engaged with the sell-side to execute orders. Now, however, they can engage directly with electronic venues, meaning an increasing focus on real-time or stream analytics. Other buy-side firms are also measuring execution quality, enabling them to scrutinise routing policies and prove best execution, once the preserve of brokers.

Equally, the sell-side are ramping up their efforts to both maintain existing and find new revenues streams as return on equity (ROE) wanes. Case in point, in a recent Tabb Group white paper on big data use cases in financial services, client retention and support were flagged as key priorities for such firms. While these strategies take a variety of forms, one common approach is IT Operations Analytics (ITOA). ITOA helps IT teams to better manage IT capacity, spot anomalies in system performance and remedy often lengthy and costly IT issues far quicker than was previously possible. As a result, firms can better mitigate operational risk and, ultimately, better serve clients. 

Big data offers huge opportunities and is poised to impact the business models and operating practices of all capital markets participants. To understand the full scope of use cases, as well as the technology empowering all of this, download this free white paper

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