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Robert Schuessler
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A Smarter Monkey

In this contributed piece, TIM noted that some traders do better than others when using data that has been run through certain analysis - that is, have used some form of machine learning to assist them.

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August 6, 2009

SIFMA Tech Show Sees Drop-Off

By Nina Mehta and James Ramage

The annual Securities Industry and Financial Markets Association technology show, which took place in June, was the latest visible sign of an industry going through hard times. The number of vendors dropped by a third this year, compared with the two previous years, and the halls were less crowded.

About 200 vendors took booths at this year's SIFMA Technology Management Conference and Exhibit, down from 300 both last year and in 2007, according to the industry trade group. Forty-three vendors were new to SIFMA this year. About 8,000 people registered to attend the tech fair, in line with attendance figures over the last half-dozen years.

Nonetheless, the exhibit areas appeared less busy and booths were packed into a tighter space. Several large vendors also sat out this year's show. Most notably, SunGard did not take a booth. IPC and Orange Business Services didn't have booths. Nor did Townsend Analytics, which is owned by Barclays Capital.

The low-key theme of this year's show was "spotlight on technology solutions during challenging times." For the trading industry, however, vendors focused on what they had stressed in each of the two previous years: complex event processing and the low-latency processing of market data to support fast trading and decision-making.

Progress Apama, Streambase Systems, Aleri, Vyahu and other complex event processing providers were out in full force at the show, many with large booths. These firms provide software and tools that enable customers to scan vast amounts of data to look for trading opportunities. The technology can be used to search for price relationships between securities that are out of kilter, based on historical relationships; stocks or other products that are briefly considered low-priced or overpriced relative to their sector or some benchmark; and other signals that yield investment opportunities.

Order and execution management system makers also made a good showing at the tech fair. Fidessa, Portware, Tethys Technology, Advent Software, Charles River Development, Linedata Services, BNY ConvergEx's Eze Castle Software and FlexTrade Systems all had real estate at the SIFMA show. Tradeware, SmartTrade, Indata, InfoReach and Nexa also had booths. Many of these firms announced new versions or upgraded features on their platforms.

Eze Castle introduced a new version of its Eze OMS. Among many new features, Eze OMS now lets users send and receive stock loan requests from the order entry ticket, as well as view and manage compliance for borrowed securities through a redesigned short-locate function.

Software vendor Quod Financial noted that its smart-order-routing technology is seeing more demand from mid-tier firms looking for technology solutions they once got from bulge bracket firms. "Mid-tier firms are taking some of the control over their trading technology back as they get more order flow," said Dhiren Rawal, managing director at Quod. The firm works with the sellside, buyside and market centers in the U.S. and Europe.

EMS, algo and analytics developer Tethys introduced functionality that enables volatility traders using its

Execta platform to minimize their cancel-and-replace fees, and maximize transaction rebates, at options exchanges. "This functionality is important for both high-frequency and regular traders," said Mary Cogger, director of sales at Tethys. Traders placing orders based on implied-vol levels need to change their quotes continuously, making it critical to manage their fee-incurring cancel rates at several exchanges.

 

 

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