Now serving: data and analytics on every menu

Healthy habits include clean and nutritious data, blended with analytics and visualization

By David M. Wallace, Global Financial Services Marketing Manager for SAS

Industry watchers are salivating over data and analytics for capital markets. TABB Group, a leading capital markets analyst firm, has a new Data and Analytics research practice alongside its traditional areas. CEB Financial Services (formerly TowerGroup), lists analytics, data and visualization among the top 10 technology initiatives for capital markets this year.

Why now? Haven’t capital markets always embraced data and analytics? A recent TABB Group research report, From Faster to Smarter, states, “It is the changing of the guard from a focus on speed to a focus on smarts.” Here are three points for consideration.

Today, visual analytical modeling is the secret ingredient.

Data: fresh and flowing

Most of us trust that our tap water is clean and safe. Likewise, in capital markets, the data tap may flow with clean data. But if it sits in a silo supporting one business area or asset class, is it healthy? A global bank executive recently told an  industry audience, “We are missing a framework for data management and data quality.”

Data governance, data quality, data lineage and a globally consistent data glossary are requirements for risk and compliance. They should be part of all modernization and efficiency efforts. Consider your firm. How much manual data transformation do you rely on to analyze risk or produce consolidated reports? If the recipe involves bodies, spreadsheets and lots of coffee, regulators won’t bite.

Picture instead whitewater running through the firm. Event stream processing can cleanse data, run models, analyze text, and detect patterns and anomalies at warp speed. Only data that’s relevant is pushed to heavy-duty analytical routines that can spot unauthorized trades or cyberattacks with minimal false-positives.

Analytics: not just for quants

Analytics and models proliferate in capital markets. Researchers build econometrics models on time-series data. Traders build algorithmic models.

What about business users? Today, visual analytical modeling is the secret ingredient. With built-in analytics for structured and unstructured data – at big data volumes (think billions of rows, thousands of columns, Hadoop) – execs can drag and click their way to correlations, forecasts and decision trees or contextual analysis, sentiment and word clouds. No coders. No text mining. No content categorization skills.

Of course, if you’re a quant, you can have heavy-duty analytics and visualization without programming, or you can dig in and direct analyze big data in Hadoop as fast as you can type.

Visualization: seeing is knowing

Visualization in capital markets has moved far beyond data exploration tools. Analytics visualization tools now deliver real insight and foresight (you could say discovery). Analytics can be automatic and invisible for executives or front-and-center for analysts. Visualization is the portal into big data for many applications including back-testing trading strategies, financial crimes, unauthorized trading, cybersecurity, finance, and risk analytics, including stress testing.

Clean and nutritious data, blended with analytics and visualization – are they on your menu? If your firm is dealing with risk, compliance, financial crimes and cybersecurity challenges the time is now – order up!


David Wallace portrait

David M. Wallace is responsible for defining industry strategy for the global banking and capital markets segments and midmarket strategy across banking, insurance and capital markets. Wallace has 31 years of experience in the application of information technology to solve customer needs, including a 17-year-focus on the financial services industry.

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Read More

  • Download the InformationWeek ebook, "The New Race to Zero" to learn more about financial firms using big data in the trading-decision process.
  • Read more from David Wallace on the SAS blogs.

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