John Brazier takes a look at some of our best analysis pieces in 2017 from Sell-Side Technology.
As 2017 draws to a close it’s time to look back at some of the best analysis that Sell-Side Technology has to offer from the past 12 months.
It’s unsurprising that regulation has dominated the market over the last twelve months, with the arrival of Mifid II just a matter of weeks away and the prospect of the General Data Protection Regulation (GDPR) and the Fundamental Review of the Trading Book (FRTB) coming over the horizon.
While Brexit has thrown up a number of questions over the future of the European financial landscape, significant advancements in artificial intelligence and machine learning are driving investment banks to greater levels of technology innovation.
Before he stepped down as CEO of the London Stock Exchange, Xavier Rolet said that the arrival of Mifid II’s new levels of market transparency was comparable to Christmas, or at least for the group’s clients. However, there are still technology-related issues to be addressed, with others warning against a race to the bottom in the name of transparency objectives.
Designed to replace broker-crossing networks, the emergence of systematic internalizers (SIs) as part of Mifid II has been a contentious and ongoing issue. Banks, brokers and buy-sides alike have all registered as Sis ahead of January and calls for greater clarity from Esma as to how the rules will be upheld have only grown in volume as the year elapsed.
Mifid II may be a sprawling, complex piece of regulation, but it is also been one of the main drivers behind European exchange’s business growth. Wiener Borse, Athens Stock Exchange, and Bats Europe (now CBOE) spoke to Sell-Side Technology about their plans to make the most of the new rules to attract new clients and built out their technology portfolios.
Artificial Intelligence has been one of the most prominent technology trends of the year, but it’s the combination of cognitive technologies – including machine learning, natural-language processing and robotics – that will yield the greatest benefits, as machines and algorithms become more ubiquitous in the capital markets.
Robotic process automation (RPA) has already made significant in-roads into banking middle-offices such as reconciliations, but some institutions haven’t been convinced by the technology yet. Disillusions over costs and inflexibility, especially compared with to alternative intelligence technologies, mean that RPA may have a limited shelf-life until more cognitive functions emerge.
The reality of Brexit for many financial institutions is relocation to other European cities than London, and, for most, Frankfurt is top of the list of ideal destinations. Technology vendors and start-ups are also looking to follow in their footsteps, meaning London faces a tough future when it comes to attracting and retaining fintech talent in the future.
Taking care of a stock exchange is no easy feat. It takes humility, strength and amusing life principles from certain animal groups to help navigate through challenging times. Wei-Shen Wong sits down with SGX CEO Boon Chye Loh to learn about those principles and how SGX is looking to expand.
In June the European Commission unveiled new plans for supervising non-EU central counterparties (CCPs) after Brexit, including the possibility that UK-based clearinghouses may be forced to relocate to the eurozone. Although the proposed rules would only apply to systemically important clearinghouses, there would still be major legal, operational and technological challenges to overcome.
Every sell-side institution is operating an innovation lab or accelerator hub to drive improvements throughout its business operations, however most have yet to look beyond their own walls. While the focus on cultural change is still a necessary and ongoing task, banks have learned lessons about chasing fintech ideals and are starting to broaden their approach to technology innovation.
Former SST deputy editor Dan DeFrancesco spoke to Nasdaq CEO Adena Friedman, who took on the role at the start of this year. Friedman discusses Nasdaq’s use of artificial intelligence for market surveillance, how she sees exchanges evolving in the coming years and her black belt in taekwondo.
Also: Trading Technologies is developing an OMS for the sell side and Orbital Insight is embracing a platform-as-a-service model.Subscribe to Weekly Wrap emails
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- Alt Data’s Ethical Day of Reckoning
- Wavelength Podcast Episode 142: AWS Talks Cloud Adoption in the Capital Markets