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Tom Steinert-Threlkeld
The Business With Bigness
September 13, 2011
Size breeds complexity, making the largest financial institutions’ operations impossible to understand, much less administer, observes John Chen.
The Bond Store
September 7, 2011
Baby Boomers are about to go into retirement. George O’Krepkie thinks he’s riding the boom of a coming bull market in loans of all types.
Answering the Call of 9/11
August 29, 2011
Ten years in, the challenge remains: never to forget. Here's a way to meet the challenge.
Speaking Volumes
August 22, 2011
The securities industry likes volume. It dislikes volatility. Can it have one without the other?
As the Crow Flies
August 17, 2011
The straightest path matters to Michael Persico. He brokers light.
Stop. To Think.
August 15, 2011
Where is it written in the Constitution (or securities law) that markets have to be open continuously, from 9:30 a.m. to 4 p.m.? A modest proposal, to avoid whipsaw in millisecond markets.
When Large Traders Fail to Appear
August 1, 2011
Could large traders simply split up their orders, so they don’t appear to be so large? Unanswered questions about the SEC’s Large Trader Rule.
Finding Good DADs
July 25, 2011
Over-the-counter stock markets are trying to grow up. So, now the offspring of pink sheets are looking to create a slew of DADS.
Out of the Shadows
July 18, 2011
Why is it that “high-frequency” trading jangles nerves so much?
ETFs vs. Mutual Funds
July 11, 2011
Unless high-speed professional trading somehow leads to more Flash Crashes and everybody decides they need complete liquidity on all investments, how fast you can get in and out of these funds should not matter much.
Greifeld, Back in the Driver's Seat
June 29, 2011
Let’s see how just good a driver you are, Bob Greifeld, now that you get a third chance to figure out a way to merge with the London Stock Exchange. And for both sides, not just one, come out winners.
Getting Real on Algo Testing
June 20, 2011
Even Dr. John Bates of Progress Software was consternated about the results of this survey, released at the outset of the SIFMA Tech show last week.
Trading Capacity in 'Very Good Place'
June 15, 2011
Fear not. Brokers who geared up for continued growth in share volume are still ready. Bring on the 30-billion share day.
Redefining Market Making
June 13, 2011
Ever since the Flash Crash, there's been talk of mandating some sort of responsibility to make markets in stocks on the companies that account for the lion's share of liquidity in modern electronic markets. There's another way, in electronic markets.
Stamford and the World's Largest Trading Floor
June 10, 2011
Will Stamford, Conn., lose the world's largest trading floor, if UBS leaves town? Don't bet on it.
Retail Investing, the iPhone Way
June 8, 2011
Now, you have to come up with an app that lets your customers shop at Wal-Mart or the mall -- and invest the savings with you.
The Math of Philosophy
May 27, 2011
Descartes postulated, "I think therefore I am." Now, if my newly minted graduate son is any indication, the modern equivalent in philosophy has to be: I code, therefore I am.
Riding the Herd, Before It Moves
May 23, 2011
Statisticians are trying to harness social media. The result? You can move on a stock, before the crowd does.
Robert Greifeld: Who Are You Going to Call?
May 16, 2011
Bob Greifeld, the aggressive chief executive officer of NASDAQ OMX Group, now has failed in the two biggest takeover attempts of his career: the 2005 bid for the London Stock Exchange and the 2011 bid for the New York Stock Exchange. The next call should go to Magnus Bocker of the Singapore Exchange. Unless Greifeld has a call waiting in his mailbox already, from Bocker.
Weigh In Now. Or Keep Your Peace.
May 9, 2011
There was a lot going on at SIFMA OPS 2011. So you may have missed the invitation to send in a proposal for what a worldwide legal entity identifier system should constitute.
A Simple Standard for Derivatives
April 24, 2011
Now, "algorithmic descriptions" are coming to derivatives. But putting the terms of contracts into computer-readable form is never easy
Giving a Single Name a Single Identity
April 18, 2011
If you’re going to have reliable trading in a stock or any other financial instruments worldwide, at any time, without fail, it’s got to have clear identification.
NYSE Shareholders Take Meetings
April 11, 2011
So the short and skinny is this: Duncan Niederauer will meet with NYSE Euronext shareholders to discuss the Deutsche Borse and Nasdaq OMX bids for their firm. He won’t meet with Robert Greifeld or Jeffrey Sprecher. But his shareholders will.
Who Wins? NYSE ... and BATS
April 1, 2011
Nasdaq OMX and Deutsche Borse will have to slug it out for NYSE Euronext. In meantime, they lose ground.
Sidestepping ‘Systemic Risk’
March 29, 2011
PALM DESERT, Calif. -- The sidestepping of what systemic risk constitutes is making it hard to know what fund companies and asset managers are supposed to do about the bill, which is not directed immediately at them, members of an Investment Company Institute panel said.
Check This Mating: SGX, Nasdaq
March 25, 2011
There are many moves on the chess board left to play. But if the Singapore Exchange's bid for the Australian Exchange falls apart and the Nasdaq OMX bid for NYSE Euronext doesn't take off ...
Just Don't Call It a "Cloud"
March 21, 2011
The average cost of a data breach is now $7.2 million. So you can't afford to keep customer data in the cloud? Not so. It's already happening.
Greifeld Plays Hold 'Em
March 16, 2011
Is Robert Greifeld bluffing about stepping in, breaking up the NYSE Euronext-Deutsche Borse marriage and putting Nasdaq OMX Group in the German exchange operator's place? Probably not. But, if he plays his cards, what does his $10 billion (or bigger) bet get him?
Tick Talk: Watching What You’re Saying
March 6, 2011
You always watched what you said to other trading desks. Now, those trading desks will not just be watching what you say. They’ll be transcribing it.
Nasdaq's Natural Alternative
February 25, 2011
Think about a rollup of all-electronic trading venues, in equities (for starters) worldwide
Clearing Up a Backdoor Takeover
February 11, 2011
All the attention about the Deutsche Borse takeover of NYSE Euronext has focused on the exchange operations -- and the symbolism of a major American capital-raising firm being under German control. But what if the deal was mostly about the backshop?
Let the Next Game Begin
February 9, 2011
The last time a German corporate giant merged with an American flagship company the "merger of equals" did not work out that well. But this time, the game is not about dominance in America or Europe. It's about creating a global always-on exchange.
Nasdaq’s Hack: Nothing to be Worried About. For Now.
February 7, 2011
Yes, it was “only” board of director information that was on a “web facing” application. But that’s sensitive enough. And it’s just the start.
Dodd-Frank Tax Battle Coming
February 2, 2011
It doesn’t take a rocket scientist to figure this out: Without a new tax on the securities industry, there won’t be reform of same.
Consolidated Fee Trail
January 20, 2011
The SEC is about to lay out its proposal for establishing a new standard of fiduciary care for investors to be given by brokers. Why not solve this the capitalist, interactive and quantifiable way, with a consolidated fee trail?
Volatility as an Asset
January 19, 2011
Volatility used to land you in jail. But that's what happens in the street, rather than on The Street.
Better Than Facebook?
January 3, 2011
Next holiday season, Goldman Sachs just might wish it had invested in a market data company, instead of Facebook.
11 (Sets of) Predictions for 2011
December 29, 2010
There will not be a consolidated audit trail set up in the next 12 months and other predictions for the New Year.
Picking Up the Tab for the C.A.T.
December 22, 2010
Maybe the SEC should pick up the tab for this breakfast. Because it may have saved the country billions in building the consolidated audit trail (C.A.T.) for stock transactions.
The Other Half
December 9, 2010
SEC chairman Mary Schapiro now believes creating a system for capturing all stock market data in close to real time is only half of the original projection of $4 billion. True. But she's probably forgetting the other half of the cost that really matters.
When The Ground Shifts
December 2, 2010
In theory, software can or should be able to “predict” returns on mutual funds, exchange-traded funds or single stocks. But figuring out when the ground shifts is not machine work.
Happy Thanksgiving, 2010
November 24, 2010
We’re going to be off on Thursday, Nov. 25, and Friday, Nov. 26. Here’s what we and all of Wall Street should be saying thanks for.
Women of the House of Madoff
November 18, 2010
When Anne Bongiorno needed to change trades listed on a customer’s account statement, she simply asked that the old one be sent back. When Joann Crupi needed to find a new custodian for assets purportedly held by Bernard Madoff Investment Securities, she simply picked a phony one.
Speed Proof
November 11, 2010
Analyzing market data and news is done in real time. Next up: The speed of trading venues and networks. Gentlemen and women, rev your algorithms – and smart order routers.
Gone in Two Seconds
November 8, 2010
At least when Nicolas Cage tried to save his brother's life, the 50 cars he stole one night did not disrupt the auto market. But when an algo goes wild, the disruption, in two seconds, is huge, says SEC chairman Mary L. Schapiro.
Taking Orders, Exchanging Risk
November 2, 2010
The SEC Wednesday likely will vote to ban naked access. But is putting the onus on brokers to develop software the right way to get pre-trade controls in place?
E-Minis and Aunt Minnie
October 28, 2010
May 6 led Aunt Minnie of Kansas City to pull her money out of mutual funds. Does she need to co-locate a server four millimeters from an exchange server, to feel she is going to get a fair shake in today's capital markets?
A License to Deal, for Algos
October 21, 2010
Hold algorithms accountable for how they are used in the systems that matter. It's not just a start towards restoring confidence in flash crashed markets. It's pretty much inevitable.
Too Many Exchanges? Not Yet
October 14, 2010
Since the May 6 Flash Crash uncovered the seeming fragility of this nation's stock markets, the prevailing wisdom seems to be that there are too many exchanges. Not.
Will You Have A Sibos Story?
October 13, 2010
You're the experts. You'll be on site Tell us about it.
For Safety’s Sake
October 7, 2010
I hadn’t been at the luncheon more than 20 minutes. And my tablemate – the chief regulatory officer for a stock exchange -- might as well have just said, “put a fork in it.”
In Greed We Trust
September 30, 2010
Pssst … is anyone out there? Trading has been quiet. Gordon Gekko is even saying time is more important than money. But don’t worry. Greed still works.
Off in the Clouds, Legally Speaking
September 23, 2010
You can put compliance into your computing cloud. But the cloud can't do the compliance for you.
Talent Worth Scouting
September 16, 2010
Wall Street is getting like the National Basketball Association. It’s sending its scouts the world over to scour its nooks and crannies for hidden talent.
Every Day Good Value: Electronic Exchange Exports
September 10, 2010
One thing America is still good at exporting are the technologies and infrastructure, as well as conceptual strategies behind, instantaneous trading of any financial instrument of any type anywhere at any time. Let's not mess this up.
Want Efficient Markets? Let SEC Phase Itself Out
August 19, 2010
Why fully electronic exchanges can and should regulate themselves.
Jerome Kerviel, Will This Compute?
August 12, 2010
It'd be very interesting to tap into Jerome Kerviel's head right now. He's the former trader who breached his limits on bets and cost Societe Generale billions. Now, his former employer has launched an enterprisewide system for assessing risk and complying with rules.
Wall Street Not A Leading Job Indicator
August 10, 2010
Wall Street is not leading the United States out of its unemployment woes.
No New Jobs? Wall Street Hiring
August 6, 2010
It's probably little comfort to those still trying to find jobs elsewhere that jobs appear to be returning to Wall Street first.
Tried and True
July 29, 2010
Innovation is great. But look where it got Wall Street. Here's why achieving "tried and true" technology takes priority.
The Microsecond Payment Model
July 22, 2010
No ‘latency’ in making a trade would be impressive. Paying for the trade without any latency, much more so.
Monitoring the Effective Operation of Markets
July 12, 2010
You’re looking at the first day in the life of Securities Technology Monitor.
The ICE Age in Climate Control
July 8, 2010
The sad history of business is that polluting pays. At least now, there are markets that will let you pollute. But others profit.
The Chi of Chi-X
July 7, 2010
Chi-X Global would have you believe that it derives its name from old world and new world symbols for trading. But, given the breadth of its world view, you almost get the feeling there is a larger explanation here.
Don't Break a Sweat
June 30, 2010
There’s a lot of angst about how ‘market structure’ will change over the next year. But some fixes don’t have to be complicated.
Alice's Doctrine of 'Unintended Consequences'
June 24, 2010
When was the last time anyone figured out how to prevent "unintended consequences." Even Alice worried about rat-holes. Let's start dealing with consequences that can be foreseen and accept that not all can be.
Bloomberg for SEC Chairman. Or More.
June 22, 2010
Who's in best position to help governments the world over to achieve real-time surveillance of markets? Think Bloomberg. Not just the company. The man.
Auditing the Audit Trail
June 18, 2010
The SEC says it will spend $4 billion upfront and $2 million a year to create a consolidated audit trail. Is that necessary? The cost, that is.
Text, in the Raw, Quant Style
June 15, 2010
Why raw text does not mean raw text. And what that says about the quantitative modeling mindset.
Joining the Hit Parade
June 7, 2010
Dear SEC: Combine the large trader proposal and the uniform audit trail proposal into one single set of rules.
Never Forget 9/11. But Bring on the Chaos.
May 28, 2010
Nine years after 9/11, Howard Lutnick has rebuilt his firm as BGC Partners, a voice and electronic brokerage with offices in 20 cities around the globe, operations in multiple asset classes and $1.2 billion in annual revenue. And he loves chaos.
Five-Minute Pause? How About Five Seconds?
May 22, 2010
The SEC proposed a five-minute pause when certain stocks fall 10 percent in five minutes. But a lot of trading takes place in a single second, these days.
Swimming With Sharks
May 17, 2010
The most stunning part of the “Bungee Jump” of May 6 is that the best forensic minds and tools at the Securities and Exchange Commission and on Wall Street could not – after a week – figure out what the precipitant was.
Getting Naked, Kicking Back, After SIFMA OPS
May 10, 2010
Watch your semantics. When Larry Tabb says he's "for dark and for naked,'' listen first to the "perverse incentives" that regulation of, say, naked access might instigate. Then, kick back.
Who Will Douse The Fire?
May 7, 2010
PALM DESERT, Calif. – Shortly after Nan Noonan, chief systemic risk officer of The Depository Trust and Clearing Corporation, warned attendees of the 2010 Securities industry and Financial Markets Association Operations Conference that Greece was dealing with a systemic problem that could call into question the entire viability of the Euro as a currency, the Dow Jones Industrial Average plunged almost 1,000 points.
Back Together Again
May 3, 2010
Technology has fragmented markets. Now, it is piecing them together again.
Arista v. Cisco: No Comment
April 25, 2010
When parrying a rival's statistical claims, the quandary becomes: Do so in public or private?
The Whey of the World
April 18, 2010
Malting barley. Skimmed milk powder. Whey. Distiller's dried gain. Futures and options markets go beyond oil, cattle and cotton -- and find buyers and sellers around the clock.
Packing a Stock Exchange into a Box
April 11, 2010
Activ Financial is talking with a stock exchange about putting a version of its matching engine in the same server box as its market data engine. It won't be that long before a complete exchange gets packed into one 3.5-inch thin box.
E.D. and the SEC
April 5, 2010
In this case, E.D. has nothing to do with any bodily function or lack thereof. Unless the body is the Securities and Exchange Commission.
Post-Trade Transparency? How About Pre-Trade?
March 27, 2010
For participants in over-the-counter derivatives markets, the issue is pre-trade transparency, more than post-trade.
Let the Real-Time Revolution Begin
March 22, 2010
The combination of a real-time trade guarantee and the standardizing of trade reporting is where the real-time revolution in trade clearing and settlement can begin.
“Superspend” on Data Centers “Dysfunctional”
March 14, 2010
Can it be? Trading firms and marketplace operators are wasting money on the big “monolithic” data centers they’re building, as electronic networks proliferate, market data explodes and volumes surge?
Calling for Action
March 8, 2010
The call was great: A "consolidated data pool should be surveilled by a unified single regulator,’’ the head of FINRA said in late October. “A single regulator that can bring the best technology, the best people, and a unified set of rules needs to be empowered." How's the empowering going?
Color the Numbers: BlackRock vs. Black Swan
February 28, 2010
How are you supposed to deal with the "unprecedented stimulus" that is both strengthening the U.S. economy and making it more fragile, at the same time?
Facing Up to Social Networking
February 22, 2010
If you listen to Allan T. Hackney at John Hancock Financial Services, social networking is relevant “here and now.” And critical to your future.
The Social Networking of Electronic Delivery
February 15, 2010
The right way to spur electronic delivery of annual reports and other documents to shareholders is ... to create better, slimmer print documents, prove their value to readers and then let them opt to get the "excruciating detail" online.
The New Audit: Security
February 8, 2010
Companies on Wall Street and off have long been required and gotten used to the requirement that their financial condition be audited every quarter and every year by independent, professional eyes. Don't be surprised, however, if annual reports and filings with the SEC in the not-too-distant future include a second opinion.
Emailing It In: No Simple Matter
January 29, 2010
Your securities firm operates in 30 countries. That means the email you exchange with customers, business partners and service suppliers has to abide by the storage, retrieval and compliance laws of 30 nations. Right? Wrong.
The Function of Fast
January 25, 2010
Wall Street should always be about finding the systems and means to fund the formation of new firms and the growth of existing ones. Or make yourself and your customers wealthier. So they’re ready to put more of their money into the strategies and companies you’re trading in. This is why speed matters.
Dow 48,000
January 18, 2010
Want some sobering numbers on just how intransigent this non-Depression economy has become? Want to argue about whether we are going to face a “lost decade” like Japan? Maybe it’s already been lost.
An Act of Blankfein: Was That a Mea Culpa?
January 14, 2010
Let it be noted at the outset that Goldman Sachs chief executive Lloyd Blankfein did not use the term "Act ..." or "Acts of God" in describing the events that led to the financial crisis of 2008 to the present. But he still has said bankers are doing ... God's work.
FIN50: A Wall Street Meter
January 11, 2010
On New Year's Eve, Securities Industry News quietly introduced the FIN50 Index, to capture by the second just how Wall Street itself is faring. Its 50 component stocks are all publicly traded companies who make Wall Street tick.
'10 Plus 10
January 4, 2010
It’s that time where forecasts abound. Wall Street is breathing easier, after its brush with death in 2008. But the Dow Jones Industrial Average has hardly changed since first crossing 10,000 on March 19, 1999. Let’s see what you forecast for the next 10 years. Then go back 10 years to see where things were a decade ago.
The Accidental Advantage of Naivete
December 28, 2009
Some times, it’s better not to know what you don’t know about financial markets. Then, you might just do things right.
A Year of Trading, Every Day
December 21, 2009
When you break it down, what high-frequency trading is breaking down each trading day into the equivalent of a year of trading (or, you could contend, multiple years). And, you cash out, at the end of each year, er, each day.
Wall Street 2(009)
December 14, 2009
On the ground floor of the building in which this is being typed, Oliver Stone has set up shop. Barely a stone’s throw from the New York Stock Exchange and in direct eyeshot of the Statue of Liberty, the movie producer is at it again. He’s shooting Wall Street 2. But he may be looking for "villainy" in the wrong place.
A DTCC For Trading Issues?
December 9, 2009
If there’s one piece of new regulation you can probably expect to see come out of the Securities and Exchange Commission early next year, it will be a set of rules on how “sponsored access” has to be controlled. It’s not too late to determine who controls the controls.
Twilight Saga for Ponzi Schemes
December 3, 2009
If the securities industry is determined enough, it could easily include algorithms that track every use, every transfer of an investor’s dollars between accounts at an investment firm and how those dollars were used. And block Ponzi schemes like Bernie Madoff's or even Tom Petters' from getting off the ground.
Mind Over Model
November 30, 2009
No matter what happens with the rest of this Greatest Recession Since the Depression let’s stop trying to blame it on runaway quantum finance. Math is not the problem. It gives answers. It provides precision (sometimes illusory). And, translated into computer coding, it runs endlessly and tirelessly. But somebody had to make it up in the first place. And maintain it. And manage it.
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