Trading Tech Themes for 2023

Geopolitical Situation 

It’s one year since the start of the war in Ukraine. A year of uncertainty, volatility and disruption, with global political relationships coming under intense pressure and scrutiny. However, in his keynote speech at FIX EMEA Trading Conference, Andrew Griffith MP, Economic Secretary to the Treasury and City Minister was keen to shine some positive light on UK capital markets and cited reforms to ensure the UK continues as a world leader and as Europe’s leading hub for investment.

He also announced the Investment Research Review which will gather evidence on the impact that the UK’s investment research offering has on both public and private markets. This, in recognition of the critical nature of accessible, timely information in the investment decision-making process. 

Key Themes for 2023 

The Changing Role of IT 

The role of IT has changed. Technology expertise is no longer the exclusive domain of IT and as the line between business and IT blurs, the pressure on IT to become a strategic leader and facilitator of change in an organisation continues to grow. The pace of technological change that affects every area of the business also creates challenges. Organisations that have invested in technologies, architectures, and practices that allow them to be nimble, even in areas held back by legacy systems are reaping the benefits. Building quality and testing in from the start; leveraging cloud technologies to facilitate experimentation; focusing on rapid and continuous deployment, were all highlighted as critical factors in driving change.  

Data as a Differentiator. 

Digital transformation and data stay top of the agenda this year, with increasing pressure on those lagging to make up the miles in order to survive. It’s no surprise that data and technology are the driving forces behind today’s most successful, digitally transformed banks and capital markets firms. Those who have harnessed the power of data and the insights it brings are gaining a competitive edge, through improved decision-making and increased productivity. 

For Quants and trading teams, the ability to access, share and integrate data is key to their performance. Producing robust and sustainable data models relies on the quality and timeliness of data, understanding the data in the context of the market, and having trust in it. The success of data modelling, therefore, is reliant upon the whole data experience – as well as having people with the skills to build them.  

The importance of mastering data was highlighted this week as Citadel, the leading hedge fund announced record profits. Citadel’s commodities business team predicts signals generated by weather phenomena and working with high-performance computing, transforms terabytes of daily data into actionable forecasts and weather-driven commercial opportunities and risks to their investment team. 

At a time when other differentiators are fading, embedding data models and analytics into investment decisions is proving one of the remaining ways to achieve a competitive advantage. 

Modernising Trading Platforms 

There was plenty of discussion this year about how to leverage technology and interoperability to create a best-in-class trading platform. For technology modernisation of this kind is it better to buy or build? 

In addition, cloud is one topic never off the agenda. This year the conversation focused on cloud as a route to agility (rather than cost-saving) and the means to deliver innovation to the business. Other aspects of cloud that were discussed included how to avoid getting locked in with your cloud provider to avoid long-term, costly contracts. 

Regulatory Compliance: Compliance regulations are becoming more complex and stringent. 

With new regulations such as MiFIR and EMIR just around the corner, firms must be able to comply in order to avoid fines and reputational damage. Compliance technology is important, with firms using automation and AI to streamline compliance processes. 

Skills Shortages 

Despite the economic challenges and layoffs within the technology sectors, the skills shortage doesn’t seem to have abated. Finding candidates who understand how to build systems that ingest, manage and use data is increasingly difficult. With rarity comes an ever higher price point and the continual risk of losing key individuals to competitors. Do you try to attract and keep them? Or outsource? 

Find out more about using data for competitive advantage. 

Digiterre is a technology consultancy that has been delivering high-risk, high-profile, and time constrained technology projects, for our clients for over 23 years. 

We do this by solving our clients’ toughest challenges rapidly and completely using a combination of deep domain expertise in the trading lifecycle, software engineering know-how, and highly effective ways of working to bring about transformational change.  

Being a problem-solving organisation means we employ highly motivated individuals willing to take ownership of delivering outstanding outcomes. We appreciate that the success of our organisation and its ability to deliver extraordinary results for our clients is all about the quality and the nature of our people. To this end, we are highly selective of the people we choose to work with but also invest in maintaining our collaborative, inclusive, and respectful culture.  

The expertise and perspectives we provide on all matters pertaining to data and the wider digitisation landscape have been especially relevant to the global trading community, as they manage current market volatility and disruption.  

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