Analytics Providers Target Trader Desktops
Traders are in the market for analytics that can inform their trading decisions, which opens the door for data analytics providers to deliver their products via the execution management system, according to Tom Doris, CEO of OTAS Technologies.
“Our task has been increasing understanding among the industry both in terms of the buy side and the other platform vendors, that analytics is key,” Doris told Markets Media. “Analytic content over and above the market data that everybody’s been focused on for so long is the key theme. We’re seeing bigger appetite from them to collaborate with specialist firms such as ourselves who are purely focused on analyzing the market data and extracting information.”
Mainstream EMS (Execution Management System) providers are keen to add value to their products, and are therefore more than willing to share desktop real estate with analytics providers.
“Not every EMS vendor or platform vendor is going to have their own flavor or their own added value in that space,” said Doris. “We’re also seeing a better understanding among the traders and portfolio managers who use our product of the impact of high-frequency trading and trading cost in general on their overall fund performance, and a more nuanced appreciation of the various options that they have in order to mitigate that.”
OTAS has positioned itself as a provider of real-time, live market data analytics that can put the portfolio manager on an even information footing with the trader. Among major buy-side institutions, Franklin Templeton is one of OTAS’ major customers, and seven of the top ten institutions by AUM are customers, according to Doris.
“Then we’ve got a group of sophisticated hedge funds and a long-tail of small institutions,” he said. “We’re now starting to speak to the sell side as well.”
The early adopters within Franklin Templeton were the trading desks. Within a large institution client like that, a larger part of the trading desk’s day is spent absorbing market information and being in dialogue with the portfolio managers and the other people involved in the investment process. “Since then it’s expanded out beyond just traders to portfolio managers and research analysts,” said Doris. “Some of the early adopters on the sell side are seeing a lot of value in terms of sales traders and execution traders.”
EMS vendors are beginning to recognize that they need to deliver content from multiple-disparate sources to the end user. “They’re all in competition for the desktop real estate,” said Doris. “They’re recognizing that they need to make it easy for people to deliver value at content into their platforms. We’re seeing that across the board with the major tier two platform vendors that they’re now using web technologies.”
He added, “Effectively you get a browser window embedded within their EMS platform. That makes it trivial for us and other vendors like us to deliver that content in context with what the trader portfolio manager is actually looking at. What we’re also going to see in 2015 is people recognizing that the analytics that we’re providing gives them an edge over their peers, their competitors, and also potentially over the sell side.”
Featured image via iStock
Goldman Sachs Asset Management’s fundamental equity business manages over $20bn in thematic equities.
Data extraction and integration is the second stage of a digitization process.
With Ankit Mittal, Business Change Manager, Global Trading, Schroders
IIGCC and lead investors will launch a pilot with companies including BP, Eni, Repsol, Shell and Total.