Overcoming Market Data Management challenges? From Regulation to Data Spend costs

“Today's Financial Services industry is increasingly complex and competitive and is subject to ever-greater regulatory scrutiny.”

Firms place a high value on accurate market data to meet their needs -- from seeking alpha for customers to achieving compliance for auditors. Many firms don’t realize how much redundancy and unnecessary costs they may be incurring in managing their market data services.

Firms need a “single view” of their market data and subscription services footprint in order to see the “big picture” cost of their vendor services.

But today’s market data managers are often stretched thin with increased regulation, the rising cost of market data and the constant internal pressure to drive efficiency while reducing overall market data spend – doing so with fewer dedicated resources.

These challenges leave little bandwidth to focus on more strategic issues and opportunities to add value to the business.

This puts managers in a stressful, complex role that involves managing multiple contracts, negotiating deals and a long list of responsibilities that leaves little bandwidth to effectively manage market data expenditures.

Focusing on market data automation can dramatically reduce a firm’s market data spend, improve operational efficiency and positively impact resource management to transform businesses ✅

Fortunately for market data managers, automated tools are available to power intelligent and efficient operations for more informed decision-making based on the true cost and the consumption footprint of an individual or group within the firm.

This can help to streamline contract renewals, automate invoice reconciliations and reduce spend with increased visibility into the firm’s needs.

This page explains the market data challenges companies face today and how to overcome them.

Use the table of contents below to navigate through the page:

More regulatory scrutiny = increased market data demand 🙋

Regulators across the globe have been mandating more transparency in financial markets in an effort to better manage systemic risk.

This creates a pressing need for global harmonization of regulation, process and analysis. The SEC Reg NMS in the U.S. and the Instrumental Reference Data Project in the E.U. both require an increased volume of market data to be reported to demonstrate best price at trade execution.

Thus, a “single view” of the firm’s market data footprint is needed to start to see the “big picture” and more easily identify cost-reduction opportunities.

Market data managers can achieve increased transparency through consolidated data warehousing and reporting 📊

This can be accomplished through strict adherence to global market data standards. Firms motivated to implement these standards should seek advice from industry groups focused on market data management to keep current on developing or changing standards.

These include the Enterprise Data Management (EDM) Council, the Financial Information Services Division of the Software and Information Industry Association and the Information Providers User Group in the U.K.

Of particular importance to market data managers should be building knowledge and expertise in the areas of:

Overcoming Market Data Challenges 🤔

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The challenges facing the industry are clear - market data managers are charged with managing in increasing volume of data, managing a growing list of regulatory requirements and making intelligent solutions despite these factors.

The industry is embracing solutions that offer a more consolidated view of market data in order to increase automation, auditability and savings globally.

While the challenge is real, these businesses are coming to understand that so too are the solutions and through either an in-house or managed services approach, today’s market data challenges are surmountable.

As the benefits of data standardization and automated analysis are realized by market data managers, these are lessons that can be applied to optimize information services across industries and roles.