How Fast is Fast Enough?

Now that financial technologists are discussing measuring latencies in the hundreds of nanoseconds, it is time to discuss how fast firms need to be in this market and whether there are any alternatives. In the latest episode of the Daly Post Podcast, I ask these and many more questions to Hyannis Port Research CEO and low-latency veteran Tony Amicangioli.

The Daly Post Podcast Returns on the 16th

Please check back then for the latest conversation on financial technology.

Save the Date

If you happen to be in New York on April 25th, please stop in to The After the Bell Forum at The Westin Times Square after work. I'll be moderating the first panel discussion on technology and automation for successful trading.  Please check it out and stay for the second panel on connectivity, co-location, big data and news-based trading as well as the post-panel networking session.

Ending the Black Box's Reign

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I just finished uploading the latest episode of the Daly Post Podcast featuring OpenGamma CEO and CTO Kirk Wylie discussing open-sourced software's benefit to Wall Street. It's about regulation now, not just cost savings.

The Future of SaaS in Capital Markets

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How has the cloud computing environment changed the delivery of software-as-a-service (SaaS)?

In the latest episode of Daly Post Podcast, Feargal O'Sullivan, the global head of alliances at NYSE Technologies discusses how adoption of open source, improved collaboration and new industry standards will make adopting SaaS a no-brainer for firms.

As a bonus topic, we also talk about the future of NYSE Technologies' Open MAMA API initiative.

Girding for Changes Under Dodd-Frank

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After a little technical difficulty, the third episode of the Daly Post Podcast is up and running on iTunes.

For anyone looking to jump on the podcasting bandwagon, be sure the system you are using is not one Wilco CD download away from maxing out your hard drive - enough said.

Thank you to the Tabb Group's Kevin McPartland for sitting down and discussing what buy- and sell-side firms can do in preparation for Dodd-Frank's final rules, which may be out as soon as September 2012 if all goes well.

Regulators and Suppliers to Drive IT Compliance Standards

A majority of recently polled European financial services and insurance executives, 57 percent, believe that they are now in the back seat when it comes to help shaping the upcoming regulatory standards and that regulators and suppliers will take the lead, according to findings by industry think tank JWG and published in a white paper sponsored by data center host Interxion.

What is a bit more surprising is that 48 percent of the respondents also believe that the regulators and suppliers will figure out the compliance standards within the next 18 to 24 months without input from the financial institutions.

It is doubtful that this would be strictly a punitive measure for the industry, but rather an admission that financial institutions do not have the available capital and bandwidth to meet all regulations coming out of Brussels and various other national capitals in a fast and furious manner.

CFTC Chilton Suggests Post-MF Global Fixes

During his morning keynote at this week's TradeTech conference in Manhattan, US Commodity Futures Trading Commission (CFTC) proposed a few market and regulation changes that will reduce the damage from firm failures and avoid another MF Global.

"First, we have to do a deeper dive in terms of regulation. We have to have to do the Tom Cruise 'show me the money,' rather than having the firms say they have the funds," says Chilton.

Next is to take a page out of the UK market's play book and let the client choose the level of risk for their funds deposited with firms.

"If they want their money just to sit there, they should have that choice," he says.

Finally, Chilton says that the futures markets should institute an insurance systems for clients of failed firms that would be similar to other markets.

Adapting to the Enterprise App Economy

How many of us have had enterprise software vendors that they plan to launch an Apple App Store-like offering in the "very near future" and that it will revolutionize how firms buy software?

Well, I am not biting. 

There are many things that Apple can teach the enterprise-size firms. However software purchasing is not one of them. 

Ever since Apple released its iTunes App Store for iPhones and high-end iPods, it raised the bar for all other software vendors in terms of intuitive user experience (UX) and pricing. The only problem is that it is focused strictly on the retail market.

Daly Post Podcast Update

Due to a sudden influx of work over the next couple of weeks, there's going be a bit of a delay in posting the third episode of the Daly Post Podcast. I'll be posting it on March 16, so please check back then.

Also, thank you for all of your support and constructive feedback on the first two episodes.

Bloomberg Pushes NEXT Migration

After an approximate $100 million investment and two years of development, Bloomberg successfully migrated a third of its 313,000 Bloomberg Professional Services clients on to its Bloomberg NEXT version of the vendor’s platform, according the senior Bloomberg officials.

The migration began three to four months ago and officials expect to have approximately 90 percent of the Bloomberg clients on the new version by summer before ending support for the legacy version by the end of the year.

Starting tomorrow and going through April, Bloomberg will host Bloomberg NEXT training sessions in 16 cities around the world, where clients can work with a variety of Bloomberg NEXT experts to help with the switchover.

Since Bloomberg officials wait until roughly a third of its customers are on a new offering before speaking with the trade press, most Bloomberg users probably already have had some cursory discussion on Bloomberg NEXT.

However, if you are not a Bloomberg subscriber or have been living in a cave for the past four months to avoid the Republican primary debates, the most important thing to know is that Bloomberg NEXT is the Bloomberg Professional Service. It may have a new name, but it has all of the existing capabilities as well as new ones and without an increase in the monthly or annual license.

Unlocking the Value of Your FIX Logs

Some time you just do not know the value of what you have. Just consider the Spaniards who discarded tons of a mysterious silver-colored mineral while mining for gold in the New World, which later would be known as platinum.

The new software-as-a-service (SaaS) vendor Cameron Edge sees platinum-quality data hiding in plain sight within FIX engine logs and plans to unlock it with its new FIXinsight analysis platform, which should be announced later this week.

“FIX logs were something that were chucked away at the end of the trading day,” says John Cameron, principal at Cameron Edge. “Some people might store them, but never look at them except when a regulator comes knocking on the door or when clients start shrieking at them.”

Community-Driven Innovation in the Capital Markets

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The second episode of the the Daly Post Podcast is ready for download!

In this podcast, we speak with Kosta Peric, the head of Innotribe at messaging cooperative SWIFT about how the organization is working with its members to foster innovation across the industry and what the first fruits of this labor might be.

Enter the Proximity Cloud

Ever since grid and cloud computing popped up on the capital markets’ radar screen, both architectures have been pitched as a cost savings technology that let users spin up virtual servers on demand and retire them as soon as the jobs they ran were over. In addition, firms can transform their capital expenses related to the care and feeding of internal clouds environments to a much lower cost operational expense by paying for just the resources they use by using third-party cloud offerings.

However, most technologists agree that cloud architecture falls down when it tries to run latency-sensitive applications. Most technologists agree that latency-sensitive applications function best on dedicated hardware, which avoids various levels of virtualization and typically are co-located with the exchange or liquidity venue. Cloud environments typically are located outside co-location venues due to the high real estate prices co-location vendors charge.

Speaking with Mark Casey and Adam Wray, CEOs of CFN Services and Tier 3 respectively, they believe that they have solved at least half of the problem through a recently announced partnership. If you are not familiar with the two 5-year old vendors, CFN Services delivers hosted co-located market data and trade execution capabilities to 70 global liquidity centers via its Alpha Platform. Tier 3 offers its clients enterprise-grade virtual private cloud environments within its Chicago, New York and Seattle facilities.

Start Listening to The Daly Post!

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A major shout out to DirectMarkets' Kevin Lupowitz, who agreed to be my first victim guest on the Daly Post Podcast. In this approximately 30-minute kick-off episode, we discuss how Kevin's firm looks to re-make the follow-on issuing businesses for corporate issuers by adopting an electronic crossing-network paradigm that directly links issuers to institutional investors.

Stopping the Spread of Greek Fire

One of the enduring mysteries of antiquity is the make up of Greek Fire.

According to records, the Greeks would use this nasty Napalm-like substance to set fire to enemy navies. For the unfortunate victims, no normal fire-fighting techniques could extinguish it. Once a ship caught fire, it burned until there was no more fuel left.

Sound familiar?

Two Tips to Drive Innovation

Innovation has been an industry buzzword for a number of years now, but what does it actually mean for organization? Or better yet, what do you do when you manager comes into your office and simply tells you to improve the innovation coming from your group?

A couple of good tips came from a panel discussion held during Innotribe regional Start-Up Challenge in midtown Manhattan last week.

Big Data Gets Up Close and Personal

If you ever wondered about the value of big data, just read this Wired article on what the data wizards over at Facebook are doing. They have identified the listening habits of members who have just started new relationships and those who have just ended relationships, so they can identify those likely to start or end relationships before they know. Sure, merchants would love this data for its targeted marketing value alone, but it also could be exploited easily for other financial uses. Imagine if you could incorporate this into algorithms that predict the performance of traders, athletes or anyone else. The opportunities are almost limitless.









 

Exchanges are Large Enough

It is curious how the financial markets can mirror nature. Nature has a way of capping the growth of a species so that it does not outstrip the available resources in its ecosystem.

After the European Union officials decided not to approve the proposed Deutsche Börse-NYSE Euronext merger last week, NYSE Euronext CEO Duncan Niederauer went on the record stating the era of exchange mega-mergers was at an end.  It appears that the global market has decided that the largest global exchange operators are large enough.

Thumbs Up to Fiennes

Ralph Finnes has done an excellent job directing and starring in his movie adaptation of Shakespeare's Coriolanus. Similar to Richard Loncraine's movie production of Richard III, Finnes sets the story in modern times. Many scenes open with CNN-like updates of the war between Rome and its southern neighbor, Volsci. The Roman forces are dressed and armed like typical NATO forces while the Volscians look more like Balkan partisans.

CFTC Won't Make SEF Deadline

No, it's not a reported fact, but just a humble opinion in this week's Friday Musing that the US Commodity Futures Trading Commission (CFTC) is overoptimistic in its belief that it will have all of the necessary Dodd-Frank rule making completed by the middle of this quarter.

Disagree? Let me know your thoughts on the matter.

Fun with Quantum Levitation

Okay Japan Institute of Science and Technology, I want one.