Celent Securities & Investments Newsletter, February 2014
From the Senior Vice President
Crowding Innovation Back In
2013 was a year in which many otherwise compelling technology priorities were crowded out by regulatory and compliance initiatives, especially among the more diversified banks, broker-dealers, and wealth managers. In fact, some of our most popular reports and blog posts in 2013 were related to US and European regulation, risk management, derivatives and market structure reform, and the associated impact on efficiency and outsourcing initiatives.
Cost reduction continues to be a major theme in capital markets. While innovative strategies for reducing cost may not be new to some leading firms, they are powerful drivers of change. The next phase after radical restructuring and outsourcing will be commercializing some of the solutions that are migrating to the cloud and other lower cost delivery methods.
Unfortunately for many firms, regulatory initiatives crowded out funding for innovation in 2013. However, in 2014, we expect some of these priorities to be crowded back in for leading firms. This investment is clearly necessary to generate growth and radically alter business and operational models.
Unlocking Data Assets
One new priority on the innovation front is clearly analytics, with last year seeing major advancements in capital markets analytics. While analytics have typically been present in the front office to support the trading of liquid products, less liquid products are now being better supported (including fixed income).
In wealth management, combining analytics and aggregated data will help wealth managers improve customer and advisor retention, discover investment opportunities, and monitor operational and reputational risks. Among the infrastructure players, the analytics revolution has only just begun, with many of these firms beginning to realize just how much data they collect, and then devising ways to find commercial opportunities.
Another area where people often don't pay enough attention to innovation is risk management, where Celent has identified the dynamics of innovation in a series of reports. Risk analytics will be a major part of that innovation.
Analytics will also continue to accelerate in private capital markets, where new service providers are emerging in 2014. For instance, there is a wide array of technologies launching which enable investors to search, inquire, match, and trade across the private capital markets sphere.
Our 2014 Agenda
Our Q1 agenda is focused on delivering Celent's perspectives and insights on the industry. In the next few months, we will continue to supplement this research agenda with cutting edge new content, webinars and events, as well as new faces. Stay tuned for more announcements.
David Easthope, Senior Vice President
Chart of the Month
From the Celent report Low Latency: Focus on Cost and Optimization
Celent Published Reports
- Low Latency: Focus on Cost and Optimization
- Global Repo Market: Next Stop, Collateral Management
- European Wealth Management Technology Vendors
- Trends in China’s Wealth Management Industry
- Future of the Post-Trade Industry, Part II: Rising Market Concentration
- Portfolio Reconciliation for Derivatives Markets: Well Begun Is Half Done
- Cost Basis Reporting: Reducing Total Cost of Ownership
Research in Progress
- Cloud Computing in Capital Markets and Wealth Management
- European Retail Online Trading Market
- IT Trends and Spending Implications for the Securities and Investments Industry
- Marketing Analytics for Multichannel Optimization
- Progress of SEFs in the United States
- Risk IT Spending: New Realities, Technology Imperatives, and Investment
5 March 2014
OTC Derivatives Markets: Global Lessons Learned from the US and Asia
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