Buyside traders, who have fully embraced multi-asset trading strategies to maximize their alpha generation, have yet to embrace systems all-in-one multi-asset trading systems that could help speed up their workflow.
That’s the findings of a new report from market consultancy Greenwich Associates, which said that buyside demand for integrated trading systems that can handle multiple asset classes are not favored as much as trader’s older legacy systems.
The report noted that 68 percent of equity, fixed-income and foreign-exchange traders operate in multiple asset classes. The most diverse are equity traders, with 72 percent of them trading more than one asset class. However, the report said that after two decades of investment in integrated trading platforms by systems providers-institutional trading desks are more interested in cross-product coverage than cross-asset technology platforms.
The report, “Cross-Product Capabilities Hold Key for Trading-Systems Providers,” surveyed 358 buyside traders. According to Greenwich’s findings, cross-asset class trading is on the rise and there is a lack of demand for integrated, cross-asset class trading platforms as a widespread solution for institutional trading desks.
It concludes that the inherent complexities of adequately servicing multiple, unique asset classes and products make developing a single system across asset classes a logistical hazard.
“It’s simply a case of following the money,” said Kevin Kozlowski, author of the report. “Rather than continuing to focus resource spend on the best multi-asset platforms, trading-system providers should focus on building solutions to trade a suite of products within an asset class.”
