As investors bolster their technology to outsmart the competition, ensuring that they have the functionality to contend with volatile and rapidly changing markets is essential. However, modern markets do not always equate to modern technology. Many firms still use bespoke legacy systems that are held back by complexities and inefficiencies, lack of functionality and, most perilously, a lack of interoperability.
While there are some powerful individual solutions, in global financial markets, every system requires some degree of interoperability. Isolated systems that cannot expand or connect to others present a major hindrance for global investors navigating financial markets. If you take TradeSmart as an example, it is clear why interoperability is necessary and why we advocate strongly for it. TradeSmart is a single, integrated, and connected solution for comprehensive order and execution management, with pre-certified connections to over 250 listed brokers and venues. This is a robust network that provides significant value to the buy-side, allowing them to access a broad spectrum of trading opportunities and liquidity sources. It is imperative to the investors who use it that TradeSmart is compatible with other systems and that TS Imagine is collaborative with other firms.
In the spirit of collaboration, I’m sharing a few guiding principles that are key to our ethos on the matter.
Standardize building blocks
In the past, interoperability would have been akin to opening a program adapted to a different operating system. Now we can create a seamless experience even when using bolt-on functionality. Once the building blocks are connected in the background, the developer of the core system can ensure that the user experience is consistent across applications – giving investors new functionality without the need to readjust to a different configuration.
It is our responsibility to facilitate, not block, interoperability. While this means playing ball with the competition, we all share the same goal of creating effective systems. To pave the way for easy integration, standardized building blocks are key. We need to ensure that this can be done seamlessly – much like a Lego set – to allow traders to access exactly what they need to build bespoke workflows. Time-consuming and clunky integration is not only costly and time consuming, but also a major frustration for investors.
We all strive to stay ahead of the curve, but no business can be everything to everyone. This is especially true when developing technology for some of the brightest minds in finance. While my team will continuously build and innovate, it is highly possible that a user may elect to use a niche product or tool that is different from our current offering. As software developers, it is our job to enable, not restrict, our users. It is therefore imperative to have interoperability front of mind as we develop technology, allowing traders to acquire crucial functionality even if we do not offer it ourselves.
Keeping a finger on the pulse
The requirement for interoperability also means that we need to know what other firms are doing and which systems users are most likely to bolt onto our platforms. We have all experienced the frustration of using incompatible systems and how it drags on efficiency – the battle between Microsoft and Apple is a prime example. In fast-moving financial markets anything that decreases speed puts investors at a disadvantage.
The best systems uphold exceptional core functionality while giving users a clear path to expand and tailor their workflows – even if this means acquiring other functionality. While capital markets technology providers will always be locked in healthy competition, it is vital that we acknowledge the need to work together in the best interests of our clients.