Trading desks are struggling to advance front-office automation as fragmented tools and disconnected data flows continue to create friction says IPC CEO Kurt Adams. Despite the availability of real-time data ingestion and automation technologies, he says traders remain hampered by disparate platforms and siloed workflows that still rely on manual intervention. Speaking to Trader TV, Adams explains how unified communications can streamline processes and improve AI-driven insights, and outlines why he believes a fully integrated, real-time front office is within reach, provided industry providers work together to dismantle long-standing technological silos.
Interview
Dan Barnes – Where do you see friction impacting the trading workflow and impacting data analysis on the trading desk today?
Kurt Adams – Too many tools, not enough connectivity, meaning more and more tools keep appearing. More data keeps coming onto the desk. I see today, traders inundated with analytics. More data isn’t really useful unless it’s able to be synthesized and turned into something that is actionable, whatever that may be. Those processes today are disparate, they’re not connected. Connectivity of communications, connectivity of workflow, and connectivity of counterparties. Traders are working in silos, trying to piece it together, and that’s where we see the friction today.
Dan Barnes – How far do you think the market is from using real-time data and fully automated execution, if you look across asset classes?
Kurt Adams – We could be a lot closer than we are. The technology exists in terms of the ability to ingest that data in a compliant way that allows the automation to happen, even think about automating a trade ticket. The ability to ingest the voice and chat feeds. The connection to the order management system, the connection to the CRM (Client Relationship Management) systems and trade desk support, that’s all needed to automate the trade tickets. The systems today are disparate. So while that all exists, there are manual interventions that have to stitch together that fragmentation. So the technology is there but I would say the connectivity is not there.
Dan Barnes – Where do you see interoperability having the greatest impact on performance within capital markets today?
Kurt Adams – I would say that in capital markets, it is early days. Very early days. One example would be the relationship with IPC and ICE. Over the last year, we’ve been doing a lot of work together, where we have the ability now to natively integrate the ICE chat and IPC voice. So if you think about communication modalities, a trader has the ability to real time, toggle back and forth. Now have the ability to have those call logs, those chat blogs, do real transcription, so there’s a full view of that communication around the trade. So there’s one seamless workflow that goes end to end through the life cycle of a trade.
Dan Barnes – How is machine learning and artificial intelligence playing into that interoperability space. What are they adding to it?
Kurt Adams – AI is going to be dependent on interoperability. It’s only as good as the inputs. So if the inputs are disparate, if they’re fragmented, if they only provide a small piece of the information, the Insight isn’t going to be very valuable. So if we’re able to provide more inputs along the workflow and the processes, the AI is going to be able to provide better insights. Better insights for ROI, price discovery, liquidity, counterparties, and even pull in sentiment analysis from what’s happening in the market.
Dan Barnes – Okay, so looking ahead, then, how would you see the future of the front office in capital markets being changed by interoperability?
Kurt Adams – We are not too far away from a future with a completely seamless and integrated front office. So today, think about a trader 85 plus times per day, interacting with either their voice, their chat system, back and forth. We call it the swivel of the chair. That will no longer exist. 20 years ago, we were still dealing with carbon copies with credit card receipts. Today, someone can come into a retailer. They can be authenticated. They can be underwritten, credit can be extended for a specific purchase in real time. And this is happening millions of times per day. The secret unlocking there was getting the providers in the industry to work together. That’s what it takes to provide the interoperability. It’s not creating more walls and exclusivity. It’s opening up to allow that interoperability, and that’s really what it’s going to take in this industry.
Dan Barnes – I’d like to thank Kurt for his insights today, and of course, you for watching to catch our other shows, including trader TV this week, every week, and the vol show every month. Go to Tradertv.net.
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