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As Chief Information Officer (CIO) of Convergex, I have the privilege of having the unique vantage point to both witness the latest IT enhancements/opportunities and to have a seat at the table to analyze and take action on all business-related IT developments. Over my 25-year career working in IT and supporting the global financial markets, I have also viewed and implemented some of the financial industry’s greatest technological endeavors. My past experience has given me a thorough understanding of how technology can spur new business opportunities, and it still amazes me how far the industry has advanced and continues to evolve.
Looking forward, there are several technology trends that I believe will have a significant impact on Convergex’s enterprise business environment and the financial industry as a whole. In fact, Convergex is leading the industry by exploring and adapting to these trends to better serve our clients.
The three main IT trends that Convergex is focusing on are:
1. Migrating to the Cloud
2. Big Data
3. Signaling Technology/Machine Learning
"Firms will be looking into how they can leverage self-learning and adaptive technology, live-streaming data in real-time"
Migrating to the Cloud
Cloud is definitely the biggest trending topic in the industry right now, not just in the aspect of storing data, but also in regards to computing data as well. With the cloud, you only pay for the processing power that you use at any given point in time while still having the elasticity to scale up and down as needed. In other words, firms no longer have to make costly investments in hardware that are only needed on high-capacity days. While inherently there is cost saving in using the cloud, firms may still be hesitant to migrate to the cloud due to security concerns as well as the belief that moving to the cloud can be a complicated process. Convergex is acutely aware of these concerns and recently deployed Ancoa’s market surveillance platform to monitor all trading activity across its domestic (U.S.) and international businesses. The deployment monitors trading activity of all lit and dark venues including Millennium, Convergex’s proprietary ATS. Furthermore, Convergex’s cloud-based deployment is running on Amazon Web Services (AWS), which provides Convergex with a managed and secure infrastructure environment while ensuring cybersecurity is managed at every level in a safe, efficient, and cost effective way.
As an early adopter of this technology, Convergex is ahead of the curve by starting our cloud migration initiative, with a target date to migrate 100+ products by the end of 2017.
“Big Data” refers to data sets that are so large or complex that traditional data processing applications are inadequate. A key component of big data is that it tends to be disparate and unstructured clusters of data in different formats. Big data, and how companies deal with processing it, is another hot topic in the industry. With big data, client information gets compartmentalized by data products or solutions, so each business has its own separate smaller data store that tends to become overwhelmingly difficult to manage and process. This is an issue that businesses cannot ignore for too long, because if a company is not processing its data correctly, it could be losing valuable customer information.
In order to address these challenges, Convergex spent a considerable amount of time in 2016 pulling together all of its big data from different platforms by leveraging Extract, Transform, and Load (ETL) to create a client profitability data visualization dashboard. This enabled Convergex to have a view of all of our clients’ data and trading activity in one place and also provides a daily comprehensive analysis of each client’s revenue and variable costs, and matches the client aggregated revenues against their clearing, connectivity and liquidity expenses. The platform has reduced the manpower needed to compile this disparate data so we can focus on our core strategic initiatives that enable us to efficiently manage our client relationships, provide better customer service and make our clients’ businesses more efficient. The way firms deal with big data will continue to be an important trending topic throughout 2017.
Signaling Technology/Machine Learning
Aside from dealing with storage, computing, and big data, another IT trend that I anticipate will have a significant impact in the industry this year is Machine Learning. Firms will be looking into how they can leverage self-learning and adaptive technology, live-streaming data in real-time, automating intelligence from that data, and optimizing performance. Here at Convergex, we are upgrading our signaling technology to further enhance our algorithms and to take advantage of machine learning technology to build correlation signals and predictive models. This technology will enable us to filter through massive amounts of data with the goal of finding more opportunities for our customers by leveraging cognitive trading solutions.
In conclusion, it is not a coincidence that the common themes discussed above surround cost efficiency and improving the customer experience. Those are the two constants that successful firms continually strive to achieve, and I believe the current trends in technology support those overarching goals.