Buy-Side Technology Awards 2016: Winners' Circle—S3 Partners

In 2014, S3 Partners was named as having the best new product on the market in the Buy-Side Technology Awards thanks to its Blacklight offering, an analytics and technology platform that consolidates all financing and capital markets data for every market, product, function and counterparty. It followed up that first win in the BST Awards by taking home the best big data technology provider category in 2015, while this year, the judging panel named the New York-based firm as having the buy side’s best data analytics tool.

S3 Partners’ Robert Sloan spoke with Waters about how the firm has been building on its success—most notably, this year, making its Black Apps kit available via Bloomberg’s App Portal—and where he sees room for growth in an intensely competitive market. 

Data analytics has become one of the hottest—and most competitive—topics in financial services. What sets S3 Blacklight apart from other analytics tools in the space?

Robert Sloan, managing partner, S3 Partners: We can do what we say. Our reporting, data and analytics are mapped and delivered to some of the world’s largest, most sophisticated information services organizations. Our tools are live, 24/7/365. If we can normalize, harmonize and aggregate data for the likes of Bloomberg and REDI, clients should have confidence that S3 can handle all their reporting tasks and requirements.

What new enhancements have been implemented over the past 12 months to S3 Blacklight?

Sloan: The Black App is most the popular App in the Bloomberg App Store. Black App provides the best way to understand how crowded trades and real-time short interest affects price action for over 23,000 securities. It covers five key areas:

• It identifies which trades are crowded and why.

• It displays real-time short interest.

• It shows real-time finance rates.

• It shows true market capacity/inventory for execution.

• It operates anonymously at the client desktop—there is no information leakage.

What are the greatest challenges facing your clients that you’re looking to help them address?

Sloan: COO and CFO clients want better reporting solutions, ones that address pressing daily business needs and help them answer “where are we today” and “where do we need to be” questions. Our Blacklight SaaS platform has the reporting to centralize and fortify mission-critical treasury management data in clients’ hands—the very people who know how to use it best. CIOs and traders want to see how financing markets and trading markets connect; the Black App shows them what trades are crowded and what forces moved price action and why.

There is a lot of innovation theater out there; S3 has a long history—14 years—of doing truly meaningful things. In the past 12 months, we have provided the market with a consolidated quote to price the bid and ask for the entire securities finance marketplace—it’s now seen by over 25,000 market participants daily.

We have redefined how to calculate and use short interest in the investment process and we’ve produced an amazing new analytic—the S3 Crowding Indicator—which portfolio managers can use to see whether a market or trade is crowded. Our real-time short-interest research is now the data source of choice for many mainstream publications, like The Wall Street Journal, Barron’s, Reuters and the Financial Times.

As the industry continues to evolve, what will be the most important factors to consider when choosing data analytics tools?

Sloan: We have much, much more in store for 2017. Simply put, can a financial data analytics provider report on anything and let users oversee everything? S3 has learned that that is the most important thing we can do for our clients.