Steve Grob, Director of Group Strategy at Fidessa looks at how super-regional sell-side firms are responding to the changing trading environment and the importance of having a more intelligent relationship with technology.
The growth in market complexity, combined with decreasing
trading volumes and an unrelenting churn in global regulation,
has had a fundamental effect on traditional sell-side business
models. Downward pressures on revenues are accompanied by the
soaring costs of servicing client demand. Simply intermediating
between clients and sources of liquidity is no longer a
guarantee of success....
Just staying in the
game requires ever greater investment in technology. But the
growth in infrastructure has to be efficient so that revenue
increases at a faster rate than the simultaneous rise in costs.
This is challenge enough for any firm: but for scale players,
with multiple lines of business to support, it is replicated
many times over.
One response has
been to consolidate technology provision, so that discrete
operational silos are collapsed into horizontal layers that
support order management, connectivity or risk management. A
single platform that can provide both depth of capabilities -
managing workflow throughout the front, middle and back office
- as well as breadth across an increasingly diverse array of
asset classes, reduces the risk of inefficient technology
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