A Holistic Approach to Trading
By Brian Schaeffer, President and a Founder at Clearpool Group
Both real-time and historical trade performance analytics are important when it comes to taking an informed and holistic approach to trading in today’s market microstructure.
As the buy side establishes best execution practices, the way they evaluate their brokers and the adjustments they make to their trading strategies are largely reliant on the algorithmic and analytical systems their brokers make available to them.
The evolution of technology and the landscape of electronic trading is becoming more transparent, however the democratization of data within organizations and with partners is still limited. If analysts are the only ones leveraging the analytics tools and programmers are the only ones capable of making changes to an algorithm, then the transparency and value of real-time analytics will effectively remain unrealized.
“Our vision at Clearpool, has always been to place transparency at the forefront of all we do. But we knew early on that transparency alone was not enough, and the real power of transparency is unleashed when you can put real-time and historic trading tools in the hands of portfolio managers, sales traders, brokers, and analysts alike,” said Ray Ross, Clearpool Chief Technology Officer.
Real-time performance analytics provide traders with a deep level of transparency throughout a trade’s active lifecycle. It also gives brokers the ability to collaborate with their buy side partners in real-time and add color on the trade executions they are seeing. The complete democratization of this data allows for a renewed level of trust and transparency between brokers and their buy side clients.
“While transparency is paramount to bringing collaboration and trust back into the equation, transparency without the ability to take relevant and timely action is insufficient in our real-time world,” said Joe Wald, Clearpool CEO.
At a time when it appears the buy side is disenchanted with their sell side partners’ services as referenced in a recent Greenwich Report, US Institutional Investors Weigh in on Sell-Side Service, it imperative for the sell side to leverage technology that will empower them to collaborate and provide a level of expertise in “unpacking” electronic executions. This will ultimately improve the performance of their clients’ trades, help them effectively manage costs and elevate their best execution practices.
While real-time performance has its benefits, pairing it with historical performance of venues and order types and adding the expertise of a sell side execution consultant puts the buy side in the best position to effectively harness trading insights to enhance their overall performance.
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