AITE Group’s most recent survey of Wall Street reveals that the vast majority of broker-dealers feel that the importance of their customer service, or "Execution Consulting Services" is more important than quality of their trading algorithms.
87% of respondents view the manageability and intelligence regarding their trading systems as more important than the actual algorithms behind the strategies themselves.
The majority of broker-dealers in the AITE Group survey now feel that "low touch service models" are no longer acceptable. Low touch (see figure) means the traditional, reactive customer support model – the customer calls and eventually the organization reacts. According to AITE Group’s survey, broker-dealer respondents reported an average 3-5 day turnaround time to resolve buy-side inquiries.
AITE Group’s report defines a next generation approach to client support that they call "Execution Consulting Services 2.0" which attempts to leap frog the traditional approach and drastically reduce the average 3-5 day response to close to real-time.
AITE Group defines ECS 2.0 as having 3 main elements:
1. High-touch advisory services concerning the optimal use of electronic trading service
2. Analytics tools for trade execution quality, risk, and transaction cost
3. Real-time tools that provide live insight, not just rear-view mirror historical reports
ECS 2.0 though isn't just the job of just one person. AITE Group sees the ECS group consisting of a cross-functional team including relationship managers, market structure experts, traders, IT, quants, and research analysts within the Electronic Trading Group. In order to provide high-touch ECS 2.0 services there is growing need for support tools that can provide a single, unified view of customer order flow and standing with the firm.
The AITE Group report goes on to identify the key technologies that broker-dealers need to better support their customers:
1. Active alerting (79%)
2. Pre-trade and post-trade trade analysis (79%)
3. Single view into client data (57%)
4. Real-time trade analysis (50%)
5. Real-time network monitoring (43%)
6. Ad-hoc query of real-time data flow (36%)
We built StreamBase LiveView to address these requirements, even though at the time we hadn't heard the term "Execution Consulting Services" used widely. But this is exactly what our development partner, and our freshman class customers for StreamBase LiveView 1.0 asked for and use StreamBase LiveView for today.
As a result, LiveView is beginning to bring event processing to the masses. Traditionally, CEP has been at the heart of apps that need machine-to-machine automated processing, like algorithmic trading. But LiveView brings that model to apps that require machine-to-human interaction, like ECS. LiveView processes streaming, real-time data and harnesses it in a way that humans can use to manage automated infrastructure like automated trading. These applications require real-time analytics, the aggregation of streaming data that can change millions of times a day, continuous query processing and in-memory data warehousing. ECS2.0 teams require ad-hoc, interactive visualization of that warehouse, the ability to slice and dice data at will, and an alerting system that pushes events to ECS staff.
For more information, read the AITE Group report or sign up for the roundtable on ECS taking place next week, or watch the StreamBase LiveView Demonstration at www.streambase.com/liveview where you will also find technical whitepapers, case studies, and lots more.