Will support the global, exchange-based trading of all U.S.-listed equity products
Extended-hours trades to be cleared by DTCC
The New York Stock Exchange, part of Intercontinental Exchange, a leading global provider of technology and data, announced plans to extend weekday trading on its NYSE Arca equities exchange to 22 hours a day.
The extended trading would take place from 1:30 am to 11:30 pm Eastern Time on all weekdays, excluding holidays, subject to regulatory approval. The NYSE will also seek support for extended trading from the U.S. securities information processors. NYSE Group’s NYSE Arca is a fully electronic exchange that ranks as the top U.S. exchange for listing and trading exchange-traded funds. All U.S.-listed stocks, ETFs and closed-end funds would be available for trading on NYSE Arca during the 22-hour weekday sessions.
“The NYSE’s initiative to extend U.S. equity trading to 22 hours a day, 5 days a week underscores the strength of our U.S. capital markets and growing demand for our listed securities around the world,” said Kevin Tyrrell, Head of Markets, New York Stock Exchange. “As the steward of the U.S. capital markets, the NYSE is pleased to lead the way in enabling exchange-based trading for our U.S.-listed companies and funds to investors in time zones across the globe.”
The NYSE plans to file updated rules with the Securities and Exchange Commission for the extended trading. Trades taking place on NYSE Arca during these additional extended hours will continue to be cleared by the Depository Trust & Clearing Corporation, which recently announced plans to extend its hours of operation.
T. Rowe Price, a global investment management firm, announced the launch of its first thematic actively managed exchange-traded fund, T. Rowe Price Technology ETF (Ticker: TTEQ). The new ETF began trading on the NASDAQ exchange today.
The T. Rowe Price Technology ETF focuses on the technology sector, applying an active and opportunistic approach to a global technology universe. With a portfolio of 40-50 high-conviction investments, the ETF centers on the most innovative and fastest-growing subsectors of the market that are powered by technology over a full market cycle.
T. Rowe Price Technology ETF is managed by Dominic Rizzo, who has ten years of investment expertise at T. Rowe Price and serves as the portfolio manager of the Global Technology Equity strategy, which has assets under management that total $9.4 billion, as of June 30, 2024. The Technology ETF is a new strategy distinct from existing T. Rowe Price mutual funds.
T. Rowe Price Technology ETF (Ticker: TTEQ)
Seeks to provide long-term capital growth, investing at least 80% of its net assets in securities of companies it expects to generate a majority of their revenue from technology or those whose competitive edge and/or market share are largely based on their technology capabilities.
Net expense ratio is 0.63%
T. Rowe Price introduced its first active ETFs in August 2020, and the launch expands the firm’s active ETF lineup to 17, including five semi-transparent ETFs, six transparent fixed income ETFs and six transparent equity ETFs. The active ETFs complement the firm’s traditional mutual fund offerings and deliver key features associated with ETFs that some investors may prefer, such as tax efficiency, more competitive expense ratios, and the flexibility to buy and sell shares throughout the trading day.
QUOTES Dominic Rizzo, CFA®, Portfolio Manager “Leveraging our deep industry expertise and commitment to rigorous research, TTEQ targets mission-critical, linchpin technologies from companies innovating in secular growth markets. We look to navigate different market environments responsibly by tactically allocating to these enduring technology companies when they exhibit improving fundamentals and are trading at reasonable valuations. In a rapidly advancing technology landscape, we believe this strategy offers an appealing option to investors who favor the ETF format and are seeking to invest in attractive opportunities globally.”
Tim Coyne, Global Head of Exchange-Traded Funds “The launch of the Technology ETF underscores our commitment to providing innovative offerings that meet our clients’ evolving needs in the ETF wrapper. As our ETF roster grows, our expansion into thematic offerings enables investors to tap into specific sectors and trends, like technology, and access the best of our active management expertise paired with the benefits of the ETF vehicle.”
Nasdaq said it has migrated International Securities Exchange (ISE) to Fusion, so that four out of six of its US options markets and one European equity derivatives market are now running on Fusion, its next-generation derivatives platform.
Adena Friedman, chair and chief executive, said on the third quarter results call on 24 October: “Four of our US options markets are running on Fusion, resulting in lower latency, higher throughput and overall increased productivity.”
Brenda Hoffman, Nasdaq
Brenda Hoffman, chief technology officer of financial technology and market services, said at Nasdaq’s investor day this year that it was the first global exchange operator to migrate a major regulated market to cloud technology. Nasdaq’s MRX Options Exchange and Nasdaq Bond Exchange (NBE) moved to AWS in 2022 and it subsequently migrated GEMX, another options exchange. Performance improved after the migration according to Hoffman with a 10% improvement in latency and tighter determinism.
US equity derivatives achieved record quarterly net revenue in the third quarter of $107m. As a result, net revenue in the market services division grew by 13% from a year ago to a record $266m in the third quarter.
“The growth was driven by higher volumes across US and European cash equities, as well as record revenue for US multi-listed options and proprietary index options in US equities,” added Friedman.
Source: Nasdaq
Index business
Friedman described the index franchise as a “true innovation engine” within Nasdaq. The business achieved a fourth consecutive quarter of record average exchange-trade product assets under management of $575bn, and reached $600bn at quarter-end.
The index business had $62bn in net inflows over the trailing 12 months, with $14bn in the third quarter of this year. Index derivatives trading linked to the Nasdaq-100 Index also grew 24% year-over-year.
In the third quarter the index business partnered with clients to bring 35 new investment products to market, including seven insurance annuity vehicles and eight options overlay products. 20 of these new product launches were international.
Adena Friedman, Nasdaq
“We remain focused on international expansion with 57% of new products launched outside the United States,” said Friedman.
In addition, US index options had a record quarter with revenue doubling year over year. Friedman said there are opportunities to expand the trading of index options on US retail platforms and that a lot of demand is also coming from international broker dealers.
In terms of international growth, Friedman highlighted Latin America as one of the regional economies where Nasdaq has been helping financial institutions better navigate regulatory complexity and the modernization of market infrastructure over the last 10 years. In Latin America there are over 10 market operators, and about 50 bank and broker-dealer clients that use Nasdaq technology.
For example, in September this year Nasdaq said it would provide its AxiomSL regulatory reporting solution to Nubank, a digital bank with over 100 million customers across Brazil, Mexico, and Colombia. Nasdaq has over 50 banking and payment services clients in Latin America.
“We look forward to our continued international expansion,” added Friedman.
Artificial intelligence
Nasdaq completed a major milestone during the third quarter with the rollout of AI co-pilot tools to all of its developers, according to Friedman.
The firm also launched an internal generative AI platform that features custom-built skills designed to enhance productivity and efficiency. In less than two months, Nasdaq has deployed about 400 unique skills, with nearly 50% of employees engaging with the platform.
For customers, Nasdaq also launched new AI-enabled products. Nasdaq Verafin, which provides crime fighting technology, enhanced its AI-based Targeted Typology Analytics with new detection capabilities for terrorist financing and drug trafficking activity. The Calypso platform has developed an innovative new methodology to conduct investment portfolio risk calculations and produce predictive analytics, based on advanced machine learning capability.
Nasdaq’s machine learning technology is combined with a sophisticated form of mathematical modelling that can significantly improve the efficiency of conducting the most complex trading and regulatory risk calculations. The new functionality can price financial instruments across millions of scenarios up to 100 times faster while significantly reducing the amount of physical infrastructure required to run those calculations.
Gil Guillaumey, head of capital markets technology at Nasdaq, said in a statement that all financial institutions trading over-the-counter derivatives are required to perform increasingly complex calculations to meet internal risk controls and regulatory mandates. The scale of required computing is driving a rethink about using AI to reduce the cost of compliance.
Source: Nasdaq
Financials
Sarah Youngwood, chief financial officer, said on the call that Nasdaq delivered its fourth consecutive quarter of double-digit growth.
Sarah Youngwood, Nasdaq
“Nasdaq’s performance continues to reflect the quality and diversity of our platforms, driving strong growth across the business with particular strength in index and financial technology,” Youngwood added. “We are continuing to deliver ahead on deleveraging and synergies and are benefiting from significant operating leverage.”
Third quarter net revenue was $1.1bn, 22% more than the prior year period, including a $146m benefit related to the acquisition of Adenza. In June 2023 Nasdaq announced the $10.5bn acquisition of Adenza, a provider of mission-critical risk management and regulatory software to the financial services industry, from private equity firm Thoma Bravo. Adenza consisted of Calypso, which provides capital markets participants with end-to-end treasury, risk, and collateral management workflows, and AxiomSL, which provides regulatory and compliance software.
Friedman said that as Nasdaq approaches the one -year anniversary of the completion of the Adenza acquisition, she is “extremely pleased” with the progress to date.
“The integration continues seamlessly, and we are delivering ahead of plan on net expense synergies and deleveraging,” Friedman added. “Nasdaq is in the early innings of unleashing the power of our financial technology division, and we look forward to building on this momentum.”
FLASH FRIDAY is a weekly content series looking at the past, present and future of capital markets trading and technology. FLASH FRIDAY is sponsored by Instinet, a Nomura company.
With growing retail investor awareness of, and education about available alternative products, active investors are looking to expand their self-directed trading into market sectors beyond traditional equities.
Adam Hickerson
Last week, Robinhood announced they will begin offering futures and index options trading for retail investors across their platform.
“Futures were highly requested by our more active and advanced traders, and we’ve built them with an intuitive, easy to use experience,” commented Adam Hickerson, Senior Director of Futures at Robinhood.
“They allow you to trade broad based indices, virtually 24-five, around the clock in a very liquid and robust marketplace – we fundamentally believe in opening up access to products like these, so that everyone can trade or manage their risk around the clock,” he told Traders Magazine.
Robinhood is one of many new entrants into the futures market, according to Martin Franchi, CEO of NinjaTrader: “With each new player, we’ve seen greater collaboration and advocacy for an under-served community.”
“We welcome new participants to help modernize regulations, develop innovative exchange products, and shine a bright light on this exciting asset class,” he added.
Robinhood’s active trader announcement was a strategic move to retain investors who might otherwise transition to multi-asset class platforms geared toward active traders, Franchi said.
“It’s a smart decision to protect their core business, which has likely seen its most active customers seeking advanced tools elsewhere,” he added.
The futures markets have shown an increase in retail participation, especially in micro-sized contracts, according to FIA’s President and CEO Walt Lukken. “Better technology and lower commissions are a big reason for that trend, but more importantly, there seems to be a generational shift in customer behavior,” he wrote in a blog.
“The Millennials, Gen Z and now Gen Alpha aren’t satisfied with owning index funds and the classic “buy and hold” strategies. They want to be more directly engaged with markets and they are seeking out brokers that offer the best tools for their trading. They may be young, but this trading segment is here to stay,” he added.
However, according to Jay T Vanerstrom, FVP – Director Derivatives Trading, Capis, many retail investors are not currently using futures, or doing so mainly through a more passive investment in professionally managed commodity funds.
Futures trading requires a higher level of investor sophistication (knowledge of product construction and dynamics; risk tolerance; active trade re-evaluation monitoring) that is usually attractive to only active, well-funded retail investors, he told Traders Magazine.
“For someone wanting invest in energy, currencies, metals or non-dollar stock indices, futures give an avenue of direct investment into these products,” he said.
With futures and equity index options, one can also get exposure to market reversals (downward market action) that is easily duplicated using stocks, Vanerstrom said.
“As with other “hot new things”, jumping in too quickly without proper research can lead to unwanted results,” he said.
“To borrow an analogy from the construct industry: Dynamite can be a highly useful tool to get some jobs done; however, when employed by the untrained or careless user, it’s likely to blow up in their face,” he added.
Vanerstrom thinks that Robinhood’s model of low-cost trading, combined with easier market access through their trading app, is likely to create an opportunity for retail interest not currently available through traditional futures and index options brokers.
“With the nature of such markets providing a level of leverage and open-ended risk in some products that require a higher level of market insight, futures and index option products will be appropriate for only a small sub-set of Robinhood’s most sophisticated customers,” he said.
For the brokerage firm, the expanded move into futures will also translate into a need to educate (and monitor) the new clients on potential risks they likely have not faced in previous investing experiences, he added.
Marty Franchi
“Overall effect on the futures and index markets is not likely to be a huge boost to trading volumes, as this market is mostly driven by the activity of large institutional investors,” Vanerstrom said.
“A more likely result to the futures industry will be to create some competition from traditional futures brokers to provide lower cost and more open access for the retail client sector,” he added.
Meanwhile, Franchi thinks that “we’re at a pivotal moment, similar to the rise of self-directed equities trading led by platforms like eTrade, which was followed by the growth of retail equity options trading championed by Think-or-Swim, OptionsHouse, and OptionsXpress”.
“Futures represent the pinnacle of the trader journey, which typically starts with a mobile experience in simpler asset classes,” he said.
Franchi added that as platforms begin to modernize retail futures experiences, and as exchanges continue to prioritize new product development, “the exponential rise of this asset class shows no signs of slowing down”.
Bank’s buy-side clients can easily access models within their research workflow solutions
New York, October 24, 2024 – Baird and Bloomberg today announced research models from Baird are now available on the Bloomberg Terminal, enabling the bank’s buy-side clients to further incorporate the proprietary content into their research workflow for more informed and timely business decisions. The models complement additional research content and market reports already provided by Baird on the Bloomberg Terminal.
Baird is now able to better support its buy-side clients including hedge funds and asset managers that are using the Bloomberg Terminal’s leading analytical tools to support investment idea generation and an efficient research process. Bloomberg Terminal customers have access to Baird’s research models, which cover more than 700 stocks across Consumer Retail, Financial Services, Healthcare, Industrials, Real Estate and Technology sectors.
David Tarantino, Director of Equity Research at Baird, said: “Baird’s research team has a long history of providing differentiated insights to institutional investors. We are delighted to partner with Bloomberg to offer some of our clients a convenient way to access our proprietary models.”
Baird’s research models are accessible via Company Financials {MODL<GO>}, the solution on the Bloomberg Terminal that enables buy-side analysts and portfolio managers to absorb key company metrics within minutes of earnings announcements and differentiate their investment research process with a quick and easy comparison of company-reported actuals to forward-looking estimates. The bank’s models are included in the Bloomberg solution that offers fundamental data for nearly 200,000 listed and private securities, with deep fundamental coverage for over 8,000 companies.
The additional research content complements the market commentary and trade ideas that Baird already provides to their buy-side clients via Document Search {DS<GO>}, the research tool that provides access to 200 million company documents and allows Bloomberg Terminal users to quickly spot shifts in company discussions with topic overviews.
Andrew Skala, Global Head of Companies and Research Product at Bloomberg, said: “Institutional investors are looking for ways to transform their business with technology that helps their research teams save time and work more efficiently. Baird’s move to incorporate their research models on the Bloomberg Terminal helps the bank’s content creators expand their reach to buy-side portfolio managers and traders that are using sophisticated workflow solutions and high-quality datasets to discover new investment ideas.”
Baird is consistently ranked as a top US research firm by Coalition Greenwich and, according to Bloomberg Intelligence’s 2024 US Institutional Equity Trading Study that surveyed 110 head and senior traders, the company grew its estimated equity wallet capture by 114% last year, more than any other equity broker. The bank joins over 100 institutions contributing models that feed Bloomberg consensus estimates, which is also supplemented by other research providers.
Bloomberg’s Data group acquires and models high-quality datasets from both traditional and alternative sources, and collaborates across the industry with content partners like Baird. Utilizing deep knowledge and advanced technology, the Bloomberg Data team enriches data, at scale, to be interconnected and ready-to-use, so users can focus on critical business decisions.
Brokers looking to get their data in front of their buy-side customers and potential partners on the Bloomberg Terminal can contact researchsupp@bloomberg.net for more information.
About Baird Baird is an employee-owned, international wealth management, asset management, investment banking/capital markets and private equity firm with offices in the United States, Europe and Asia. Established in 1919, Baird has approximately 5,100 associates serving the needs of individual, corporate, institutional and municipal clients. Baird has more than $455 billion in client assets as of June 30, 2024. Committed to being a great workplace, Baird ranked No. 34 on the 2024 Fortune 100 Best Companies to Work For® list – its 21st consecutive year on the list. Baird is the marketing name of Baird Financial Group. Baird’s principal operating subsidiaries are Robert W. Baird & Co. Incorporated and Baird Trust Company in the United States and Robert W. Baird Group Ltd. in Europe. Baird also has an operating subsidiary in Asia supporting Baird’s investment banking and private equity operations. For more information, please visit Baird’s website at www.rwbaird.com.
About Bloomberg Bloomberg is a global leader in business and financial information, delivering trusted data, news, and insights that bring transparency, efficiency, and fairness to markets. The company helps connect influential communities across the global financial ecosystem via reliable technology solutions that enable our customers to make more informed decisions and foster better collaboration.
The generative AI-powered assistant for Investment Banking, Sales & Trading and Research supports staff in efficiently surfacing and distilling high-quality insights from the expansive body of Morgan Stanley Research
Morgan Stanley Research announced the launch of AskResearchGPT, a unique generative AI-based assistant that addresses the needs of the bank’s Investment Banking, Sales & Trading and Research staff. AskResearchGPT can be leveraged to look for data, obtain insights and summarize information from the firm’s expansive body of Research – more than 70,000 proprietary reports published annually. With convenient, one-click access within their day-to-day workflow, the generative AI tool gives staff a more comprehensive, in-depth view of the most current Research information, so they can provide the firm’s institutional clients with higher quality service in a more effective manner.
“AskResearchGPT is emblematic of our tech-forward philosophy in Institutional Securities,” said Katy Huberty, Global Director of Research and Co-Chair of the Morgan Stanley AI Steering Committee. “Our most important objective is to provide our clients with world class analysis and information to help them generate alpha. AskResearchGPT boosts our employees’ ability to support our clients with just that – better and at scale.”
AskResearchGPT is a generative AI-based augmentation to the already popular AskResearch application, a chatbot that helps pinpoint data, key findings and analyst ratings from the vast library of Morgan Stanley Research reports. In AskResearchGPT, OpenAI’s GPT-4 model is supercharging the capabilities of the original tool by synthesizing unstructured data, empowering users to address more complex questions by drawing comprehensive insights and summaries from multiple research products. AskResearchGPT is conveniently accessible across the suite of productivity and communication tools used every day, facilitating seamless access to research whenever needed.
Additionally, the assistant is paired with a workflow solution, patented by Morgan Stanley, which gives staff a single-click option to transfer findings of their queries into an email draft ready to be modified and customized before sharing with their clients. Findings include hyperlinks to citations of relevant research materials providing staff and clients with the ability to dive deeper into the original research.
“AskResearchGPT gives our client-facing teams a leg up, freeing capacity to more deeply engage with clients while providing better than ever service. It is an important step in delivering a firmwide Research platform that is not only omnipresent across our tools but will ultimately extend its capabilities with other information sources, skills and languages,” said Eden Kidner, Head of Technology Strategy for Morgan Stanley Research. “We continue to experiment with the most recent generative AI improvements, identifying other opportunities to enhance our employee and client engagement.”
Morgan Stanley has leveraged AI and machine learning for over a decade to boost productivity and client service. The firm pioneered the use of generative AI on Wall Street with its unique partnership with Open AI, which was announced in spring of 2023. AskResearchGPT is the first use case in the Institutional Securities arena, joining a continuously growing suite of generative AI powered tools including the AI @ Morgan Stanley Assistant and AI @ Morgan Stanley Debrief, which were successfully rolled out to the firm’s Wealth Management financial advisors and staff over the course of the past year.
Bank of America’s patent portfolio has seen a 94% increase in artificial intelligence (AI) and machine learning (ML) granted patents and pending patent applications since 2022.
Aditya Bhasin
“Our approach to AI includes human oversight, transparency, and accountability for all outcomes. Our investments in it and other technologies also help drive operational efficiencies and responsible growth,” Aditya Bhasin, Bank of America’s Chief Technology & Information Officer, told Traders Magazine.
Bank of America spends over $12 billion annually on technology, of which approximately $4 billion will be directed to new technology initiatives in 2024.
These ongoing investments continue to enhance client experiences and to drive operational efficiencies.
“We innovate to meet and anticipate our clients’ needs. As our pace of innovation accelerates, we’re continually listening to clients and building solutions to improve and simplify their experiences,” Bhasin said.
“Such has been the case with our approach to AI, machine learning, and related technology for many years – the use of which centers on the benefits to our clients and employees,” he added.
In addition to artificial intelligence and machine learning, other technology categories in which new patents have been granted to Bank of America this year include information security, online and mobile banking, payments, data analytics, and augmented and virtual reality.
Source: Bank of America
Overall, the bank holds nearly 7,000 granted patents and pending patent applications, and the most granted patents of any financial services company.
According to BofA, this is thanks to the creativity of its more than 7,500 talented inventors based in 14 countries and 42 U.S. states, and a culture that empowers teammates to explore and develop innovative solutions for individuals and businesses around the world.
AI and ML enable banks to analyze large volumes of data, offering insights that drive efficiency and innovation.
For example, in Global Markets – Bank of America’s internal facing chatbot leverages natural language processing and machine learning to answer queries that arise during the trading day – continually improving the accuracy of responses based on previously answered questions.
Deployed to over 20 areas of Global Markets, the chatbot connects the company’s proprietary systems and databases to deliver intuitive responses to trading-related questions such as real-time market depth, trending indicators, historical trading volumes, current exposures, and unmatched or cancelled trades. This enables traders to respond to client inquiries with greater consistency and speed, and with higher quality data.
Another example include Erica, an AI-driven virtual financial assistant. More than 45 million clients have used Erica and this has led to 2.4 billion interactions with Erica since its launch in 2018. Over the last six years, Erica’s capabilities have expanded to support individual and corporate clients, including within Merrill, Benefits OnLine, and the company’s award-winning CashPro platform.
In addition, launched in 2020, Client Insights uses AI-enabled data analytics to help Merrill Wealth Management and Bank of America Private Bank advisors identify, manage and act on changes in client circumstances. This leads to opportunities to best serve clients’ tax harvesting, retirement planning, and student banking needs, and more. Over 30 million insights have been delivered to advisors since launch, helping them and their teams proactively connect with clients about these timely and relevant opportunities.
J.P. Morgan announced the launch of its Private Markets Data Solutions for institutional investors, available through Fusion by J.P. Morgan. This is a comprehensive data management solution for private assets that enables investors, both General Partners (GP) and Limited Partners (LP), to analyze and gain transparency into their complete portfolio across public and private holdings and eliminate the manual processes of managing this operational workflow at scale.
The growth of alternative portfolios has presented investors with unique data challenges. The lack of a single, standardized source for private markets means investors are left with incomplete and fragmented data that is difficult to analyze. The process of manually extracting and integrating data from unstructured sources is time-consuming, costly, and error prone. Managing multiple vendors, data feeds, and portfolio administrators complicates data consolidation and transparency, affecting decision-making and necessitating specialized expertise and scalable technology, which further escalates costs and delays time to market.
Fusion minimizes the need for resource-intensive processes by offloading this workload to algorithms that work automatically, accelerating time to insights. Data is ingested from J.P. Morgan Securities Services and portfolio administrators, which is then complemented with reference data from vendors. Developed by J.P. Morgan’s data experts, Fusion’s proprietary AI-ML technology helps correct discrepancies and incompleteness and applies standard identifiers for consistency and easy interoperability. Clients receive standardized, enriched data that is consistent across diverse asset classes like private equity, real estate, venture capital, natural resources, and infrastructure, while preserving granular detail and linkage.
Tim Fitzgerald, Global Head of Securities Services, said, “Securities Services is committed to helping clients meet the challenges of an increasingly competitive private asset market with innovative data-driven solutions. Our platform empowers clients with more information to drive their decision making, while optimizing their workflow.”
To offer clients a single source for more complete, high-quality data that works across public and private assets, Fusion has incorporated data from Aumni, J.P. Morgan’s private capital platform, and external leading data providers like Canoe Intelligence, MSCI Private Capital Solutions, and PitchBook. Investors can analyze and manage their data with the Fusion Data Explorer tool, allowing them to drill down into underlying assets and navigate across linked data points, for a deeper understanding of their holdings.
Gerard Francis, Head of Fusion, said, “Fusion is uniquely positioned to integrate private markets and client investment data, leveraging proprietary graph technology and AI-ML models for comprehensive portfolio transparency and interoperability. Our cloud-native platform supports data from multiple portfolio administrators and vendors, ensuring seamless integration, scalability, and a streamlined experience without legacy infrastructure constraints.”
Fusion’s Data Mesh supports a variety of cloud-native channels, designed to simplify the process of integrating Fusion data into clients’ existing technology stack. For business users, the newly launched Fusion Drive enables desktop applications like Excel, Tableau, and Alteryx to connect directly to Fusion data, and receive updates automatically.
Private markets data integration: Fusion takes in reference data from leading providers like Aumni (J.P. Morgan’s private capital platform), Canoe Intelligence, MSCI Private Capital Solutions, and PitchBook.
Data ingestion from multiple fund and portfolio administrators: Fusion supports portfolio data from J.P. Morgan Securities Services and other portfolio administrators that clients use. Data is harmonized for seamless interoperability across administrators.
Data normalization: Data is normalized to look and feel the same, so it’s ready to be used across investors’ operating models. Fusion models data for clarity and consistency, applying standard identifiers and linking relevant datapoints.
Complete portfolio view and Data Explorer: Investors can view, analyze, and drill down into private market data using an intuitive exploration tool. The linked data model enables interoperability between private and public asset classes, portfolios and accounts, to easily dive deep and analyze.
Data management: Fusion gives clients powerful controls to apply rules-based adjustments and overrides to data. This functionality allows users to ensure data is fit-for-purpose across multiple lines of business without altering the underlying data or linkage.
Data Mesh: Fusion offers a suite of cloud-native channels for clients to integrate Fusion data directly into their tech stacks, including API, Jupyter Notebook, Snowflake, Databricks and more. Connect data directly to your desktop applications with Fusion Drive.
Equity traders looking to stay ahead of the curve—and the competition—are turning to alternative trading systems (ATSs) that are experimenting with new innovative features to improve trading outcomes.
About 16% of U.S. equity volumes overall are currently executed via ATS and could be accounting for at least half of the liquidity needs for institutional traders. Traders are attracted to these systems for their potential ability to deliver high-quality execution and enhanced liquidity with less information leakage and impact.
Three innovative ATSs, IntelligentCross, OneChronos and PureStream, are winning over the hearts of market-savvy buy- and sell-side firms. One of the main benefits of these providers is their ability to innovate.
“ATSs are incubators in a market structure laboratory, with less stringent rule sets than exchanges,” says Jesse Forster, Senior Analyst at Coalition Greenwich Market Structure & Technology and author of The Innovators: How and Why Alternative Trading Systems Succeed.
Unlike traditional trading venues, ATSs introduce an element of unpredictability in their outcomes, making them less attractive to ultra-low-latency strategies and reducing market impact. This is a feature, not a bug. As both the buy side and sell side seek out the benefits these new platforms can deliver, forward-thinking brokers are embracing these ATSs, recognizing the advantage of having multiple venues to experiment with.
“The ATSs gaining traction today have sparked a hunger for further innovation, paving the way for the next generation of groundbreaking trading venues to emerge,” says Jesse Forster.
Remembering John “Mac” McQuown, Whose Curiosity Drove a Life of Innovation
Source: Dimensional Fund Advisors
John “Mac” McQuown, a founding Director of Dimensional Fund Advisors in 1981, was a financial engineer, entrepreneur, and environmentalist with an insatiable curiosity and relentless drive that led him to start more than a dozen companies in his lifetime.
A self-described “data dog,” Mac was a pioneer in the transformation of investing from guesswork into a science guided by academic research.
In the 1970s, he assembled a team at Wells Fargo Bank that developed one of the first index funds—the investment vehicle whose rise would later revolutionize the financial world. And after helping launch Dimensional, Mac remained on the company’s board while he pursued interests that ranged from bond-investing innovations to sustainable farming to wine making. He died on October 22, 2024, at age 90. He is survived by his wife, Leslie, his son, Morgan, and his daughter-in-law, Alexa.
“To bring about fundamental change, you need great thinkers and researchers, but you also need implementers,” Dimensional Founder David Booth told Bloomberg Markets magazine in 2015. “People like Mac don’t win Nobel Prizes; they implement the ideas of the guys who do.” The descriptions of his life in this article are based on years of written and recorded recollections from Dimensional employees and others associated with the firm, except where otherwise noted.
