SIZE OF FIRM:
WHAT WORK EXPERIENCE HAD THE MOST LASTING IMPRESSION ON YOUR CAREER?
LAST GOOD BOOK YOU READ:
The U.S. equity markets were revolutionized in the late 1990s by electronic marketplaces such as Instinet, Island and Archipelago. Through the broader acceptance of electronic trading, regulatory changes and the focus on execution costs due to unbundling, markets around the world are on the cusp of the same type of upheaval. We're already seeing it in Europe with the launch of systems such as Chi-X. But Canada, Asia and probably even South America will soon likely see these same changes.
Key Technology Management:N/A
Size of Technology Team:About 150 globally.
Percent of IT Projects Outsourced:Instinet handles all development and support internally.
Key Technology Partners:For the most part Instinet uses commodity hardware and handles all software development internally.
Success Metrics:Measuring success is actually one of the easier things we do since a system either works well or it doesn't. Obviously, there are other criteria, such as whether the project delivered on-time and on-budget, but it's pretty black-and-white.
Going Global With Instinet's ATS Strategy
Instinet's major 2008 development initiative is the continuation of our ATS strategy around the world. We've just recently launched Chi-X for trading European equities and are readying similar systems for Canada, Korea and Japan. We believe the global equity markets are poised to see the same types of benefits through electronic marketplaces that the U.S. saw in the late '90s, and we're allocating development resources accordingly.
Moving Into New Asset Classes
Instinet offers a very powerful platform for the trading of equities, and we're looking to expand into the derivatives markets. However, there are regulatory hurdles that need to be met before we can roll this functionality out, and Nomura, our new parent company, offers a very compelling platform of its own that we may leverage, which is why we've been somewhat deliberate in our move into this space. Our hope is that we'll soon be able to offer our clients access to these markets.
Integration With Nomura
Our final major 2008 initiative is the ongoing integration with Nomura. This is probably more of a business initiative than a technology initiative, but it will be very important to the long-term success of both firms.
TOP 3 CURRENT PROJECTS
Rewriting Instinet's "Core"Our primary project, which should be completed soon, is a rewrite of what we call the "Core," which is the fundamental technology that touches pretty much everything Instinet does. With this new Core we will be a much more efficient technology organization, as it will serve as the underpinning of our global matching engines, algorithms and front ends.
Newport Portfolio Trading System OverhaulWe are completing a major overhaul of our Newport portfolio trading system, which is used by some of the biggest global portfolio traders in the world. We're currently beta testing it with Instinet's agency sales traders and a few clients, and hope to roll it out to our entire Newport client base later this year. The new system, Instinet's third major upgrade to Newport, will offer significant upgrades to the pre-, post- and real-time analytics functionality within Newport. It will also provide the ability to use any broker's algos through the system and will include features to allow clients to customize the system.
Algo DevelopmentCurrently we're working on a dynamic volume participation rule that automatically adjusts its schedule based on changes in market conditions, the stock's sector, etc.