Conclusion

An integrated technology stack for the sell side is key to managing risk and regulations

As the sell-side landscape has grown more complex, there is more pressure to meet regulatory mandates such as FRTB and new margin requirements.

Companies need to reassess their technology stacks to ensure they work efficiently and intelligently, while remaining compliant.

Providing clients with better quality data is critical, particularly when managing risk and regulation. Automating parts of the trading process can ultimately help to simplify risk oversight, while improving client management data and tools.

By creating a systematic, streamlined workflow that prioritizes intraday risk metrics, it’s possible to solve for some of the biggest sell-side challenges, including tech stack fragmentation and adherence to new requirements. The key lies in integrating all the disparate elements - sifting through analytics in a piecemeal way for example, wastes time. Integrating the workflow allows traders and salespeople to move much faster and use that efficiency to capitalize on trade ideas.

 

While increased adoption of electronic trading continues, companies still benefit from the human element with specialized employees who are engaging with data and market trends. Essentially, salespeople and traders need to communicate effectively to capitalize on those skills sets and experience. Integrating that constant interaction between the sell side and its clients into existing trading workflows is an essential step.

Transparency of data is equally critical. It needs to be correlated and aligned, not only in the interest of remaining compliant, but also to offer the best advice and solutions to clients. Integrated workflows can also act as a framework for risk and data to work together and depend on one another, as accurately and frequently updated risk metrics are essential to the sell side.

Transparency of data is equally critical. It needs to be correlated and aligned, not only in the interest of remaining compliant, but also to offer the best advice and solutions to clients. Integrated workflows can also act as a framework for risk and data to work together and depend on one another, as accurately and frequently updated risk metrics are essential to the sell side.

FRTB and other regulatory frameworks are forcing the risk metrics to assume even greater importance for the front office, and assuring continuity is a priority. Enterprise trading solutions provide a connected hub – no trade can happen in a compliant, efficient way without it. Between the front, middle, and back offices, everything is synchronized, tracked and monitored.

As more data is consumed and analyzed, companies need to evolve their processes to assess and evaluate risk. Becoming more sophisticated will allow sell-side teams to move faster and communicate better, capitalizing on a clearer view of their risk exposure.