Data & Trading: The Change in Capital Markets Infrastructure

Data is the most valuable asset a company has, and what a company does with that data can be a great indicator of its success. But what do data and trading mean for you? In this episode of The Yield, Yieldstreet CFA Peter Kerr is joined by Francis Wenzel as they discuss the role and accessibility of data as it relates to trading, compliance, artificial intelligence, and machine learning within the financial markets. Francis is a financial data and technology expert who is applying his knowledge and experience to TickSmith, a true “FinTech” software company that combines cutting-edge technology and deep knowledge in Capital Markets to reach new summits of innovation. Driven by more data-intensive data requirements for trading, compliance, artificial intelligence, and machine learning, there has never been so much traditional and alternative data to work with. TickSmith’s highly scalable, modular platforms, built on open-source technologies are crucial in today’s data-driven world.

Key Takeaways:

[1:46] Enterprise software company or cutting-edge fintech? TickSmith is actually both.

[5:52] Data privacy concerns at every usage level of company and individual data.

[8:31] Why are capital markets so interested in data?

[12:25] Correcting the pitfalls in the buy-side capital markets and a look at one of the biggest new trends in data sharing.

[15:00] TickSmith’s role as a data platform seller, and how data might be utilized moving forward.

[20:17] Benefits of using charting and technician analysis tools.

[23:15] The financial potential that comes with understanding and utilizing data.

[25:06] Practical use cases of data in blockchain and cryptocurrencies.

[28:17] The computer revolution is bigger than the industrial revolution.

So what do companies do with all of this data? It comes down to three key concepts — white room, which is a neutral application of that data; internal data distribution, which allows data to be accessed for use within the company; and selling data, which addresses the concept of packaging data products in a way that doesn’t result in any data privacy issues. Capital markets in particular are interested in data because finance itself is driven by data. And with so many applications for financial data, the value of this content is extremely high.

The buzzwords in the computer revolution — cloud, AI, machine learning — all share the same truth — that it has become cheaper than ever to do any type of computing, to store data, and to utilize computing-intensive applications within finances. With the use of all of the stored data, more and more companies are looking for ways to apply this data to benefit their company’s bottom line. This means that the need to acquire data is becoming stronger and stronger. The demand for alternative data has moved outside of just capital markets, hedge funds, and the buy-side looking for this type of content for their models.

New trends in data sharing and data rental are opening up new realms of possibilities when accessing data while keeping that data with the firm that owns it. Not only does this trend reduce data leakage while still providing access to the content, it keeps data from physically being transferred and greatly increases data security.

But how will data be utilized moving forward? The data economy aims to further innovation and the utilization of data is clearly serving companies globally. According to Francis, “in the future, data will be perceived the same as any other good.” And the result will be a simplification of details and an improved customer experience across the board.

And who is buying data today? As more data becomes available, its practical applications are becoming more useful to a wider variety of users. And as more people are educated about what data they themselves individually represent, how it moves around, and how they can even personally eventually leverage that data, the opportunities to sell it or make some money around it will also increase. To learn more about how data leverage can help you realize your next level, visit today.

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