Financial Markets Solutions: Addressing Challenges within the Evolving Marketplace


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IBM financial markets front office solutions can help financial firms accelerate their ability to meet the challenges of automation, visibility, flexibility and scalability from both a business and technical perspective.

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Financial Markets Solutions: Addressing Challenges within the Evolving Marketplace

  1. 1. Philip Enness – Global Solutions Manager, Financial Markets August 2010 Financial Markets: Front Office © 2010 IBM Corporation
  2. 2. Building a smarter planet Significant growth in global assets is expected The value of global assets will quadruple $1,264 reaching $1,264 trillion by 2025.1 Beyond the recent crisis, there is an unprecedented opportunity for the financial services industry to intermediate and manage the enormous global growth of capital and creation of wealth. 2 1 – IBV; Assets are deposits, equity and fixed income © 2010 IBM Corporation
  3. 3. Building a smarter planet Global Financial System is Highly Interconnected  Massively interconnected Financial  Evolving organically institutions  Intersection points increased Compliance Surveillance and monitoring 14x in 20 years Soundness Regulators Stability Supervisors  Moves more than $74T around the world each day Laws and rules Standards  25 billion market data Policy makers messages travel across global trading systems every day 1 – Rethinking the Financial Network, Andrew Haldane, Executive Director, Financial Stability, Bank of England 3 © 2010 IBM Corporation
  4. 4. Building a smarter planet Explosive Growth in Trade & Volumes Continues Focus on Client centricity and Risk are High Priorities  Trade and volume growth  Regulatory directives and have grown exponentially in risk mitigation policies are the last few years and are driving IT spend forecast to continue to grow at ever faster rates, once economies return to health. Source: Aite Group, survey of 30 Global Source: NYSE Euronext, Aite Group estimates, April 2009 capital markets CIOs, Oct & Nov 2009 4 © 2010 IBM Corporation
  5. 5. Building a smarter planet Electronic and Algorithmic Trading Trends  Use of Electronic Trading  Use of Algorithmic Trading is becoming predominant is most common in the U.S., across all asset classes but is growing in all regions and across all asset classes Global Adoption of Algorithmic Algorithmic Trading Adoption by Asset Class Trading United States Europe Asia Equities Futures FX Options Fixed Income 5 Source:: Aite Group, June 2010 © 2010 IBM Corporation
  6. 6. Building a smarter planet Winners will focus on three key imperatives Reinvent the Develop new Integrate risk business model intelligence management Drive a simplified Develop enterprise Achieve compliance and streamlined wide capabilities to objectives while agile enterprise enable informed mitigating that balances judgment, client- operational risk, growth, efficiency centricity and fighting crime and and business profitable growth optimizing financial resiliency returns 6 © 2010 IBM Corporation
  7. 7. Building a smarter planet Required functionality and capabilities Automation Visibility Flexibility Scalability 7 © 2010 IBM Corporation
  8. 8. Building a smarter planet Automation  Unified integration framework  Qualitative context based decision engine Automation  Standardization of inputs and human intervention for dynamic algorithm creation  Inherent cross asset and cross market Visibility support Flexibility Scalability 8 © 2010 IBM Corporation
  9. 9. Building a smarter planet Visibility  Strategic guidance control methodology Automation  Embedded proactive safety measures  Full transparency of actions and Visibility decisions Flexibility Scalability 9 © 2010 IBM Corporation
  10. 10. Building a smarter planet Flexibility  Short implementation time  Caters by design for continuously Automation changing needs  Easily incorporate existing functionality  Unlimited extendibility Visibility Flexibility Scalability 10 © 2010 IBM Corporation
  11. 11. Building a smarter planet Scalability  Ultra fast framework  Unmatched performance by Automation parallelization and prioritization  Dynamic by nature  Embedded self optimizing and Visibility healing characteristics Flexibility Scalability 11 © 2010 IBM Corporation
  12. 12. Building a smarter planet IBM’s Financial Markets Framework Automation Visibility IBM’s Financial Markets Framework Scalability Flexibility 12 © 2010 IBM Corporation
  13. 13. Building a smarter planet IBM’s approach to the Financial Markets Framework  Provide an agnostic framework to support the trading life cycle Automation  Enable integration with existing business processes through a flexible infrastructure Visibility  Innovate to meet the growing market data and trade execution needs  Partner with Customers to enhance Flexibility the Financial Markets Framework  Develop an Ecosystem  Support Open Standards initiatives Scalability 13 © 2010 IBM Corporation
  14. 14. Building a smarter planet IBM’s Financial Markets Framework Financial Markets Solution Buy Side and Sell Side Exchanges  Market Data Solution (FO)  Next-Generation Trading Infrastructure  Algorithmic Trading Platform (FO)  Market Surveillance and Trade Monitoring  Securities Processing (M/BO)  Settlement Risk Management  Market Data Solution High performance market data solution with an attractive cost structure  Algorithmic Trading Platform Scalable solution for automated trading  Next Generation Trading Infrastructure Ultra High Performance transaction infrastructure with superior reliability  Market Surveillance and Trade Monitoring High performance surveillance and monitoring system to meet changing risk management and compliance needs  Settlement Risk Management Measure and monitor risk associated with unsettled trades  Securities Processing Settlement and Clearing solution with support for Swift and ISO 20022 14 © 2010 IBM Corporation
  15. 15. Building a smarter planet IBM’s Financial Markets Framework Market Visualisation External Gateways Internal Gateways InfoSphere Streams PE Sink Market Data Source PE PE PE Sink Analytics PE Sink Source PE PE Market History & Order Book Processing Processing Processing Processing Processing Element Element Element Element Element Container Container Container Container Container InfoSphere Streams Data Fabric Transport - / Ethernet TCP-IP MWLLM Informi x Business Events Monitoring & Reporting Other Apps. Pricing Quoting Risk Trade Hedging © 2009 IBM Corporation 15 Execution © 2010 IBM Corporation
  16. 16. Building a smarter planet Deploying IBM Financial Markets Solutions 16 © 2010 IBM Corporation