Investing in Big Data Is Top Priority, But Buy Side Asks, ‘Whose Job Is It?’

For many on the buy side, Big Data is synonymous with analytics and business intelligence, and the largest investment they will make in their execution desks in the next three years will be on ‘market data and analytics.’ But within the majority of firms, no particular group is responsible for data governance.

Last year, business analytics and innovation evangelist Timo Elliott observed that “big data” means different things to different people. Some see it as simply the growth in the amount of data or the development of diverse datasets. Others see it as an opportunity or as a metaphor that describes the amount of data generated (and collected) from business operations and transactions.

Participants at Bloomberg Trading Solutions’ London Buy Side Forum in May voiced that “big data,” at least to them, is synonymous with analytics and business intelligence.

Big data can provide insights—giving traders, portfolio managers and fund executives answers to questions that they didn’t even realize they had. Properly harnessed, data can provide the insights to optimize processes and identify relationships across the investment life cycle to help drive down the implicit costs of trading and provide management with an understanding of the business (where you make money, lose money and waste money) at a level not previously possible.

[Related: “Big Data Red Queen Problems: Making New Mistakes, Meeting New Challenges”]

This is why, when polled, 42 percent of participants at our client forum responded that “market data and analytics” is the largest investment they will make in their execution desk in the next three years (Figure 1, below).

Figure 1

Sixty-two percent of participants said they will start reviewing their data management policies this year, with as much as 77 percent addressing the issue in the next two years (Figure 2, below).

Figure 2

Clearly, buy-side clients we’ve spoken to recognize the value in harnessing their own data to provide their firms with insights. However, they appear to be in the early stages of collecting and using their own data to produce these insights because 55 percent of participants at our event said no particular group within their firms is responsible for data governance (Figure 3, below).

Figure 3

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