Amex CIO Prepares to Launch New Hybrid System, AEMI, for Reg NMS
The American Stock Exchange
86 Trinity Place
New York, NY 10006
SIZE OF FIRM:
Averages 90 million shares a day in equities; Amex trades 700,000 to 800,000 contracts a day in options.
PREVIOUS POSITIONS:
Consultant to the Amex on electronic trading/ECN opportunities; Instinet Services, chief technology officer.
EDUCATION:
B.S. from Rochester Institute of Technology.
WHAT WORK EXPERIENCE HAS HAD THE MOST LASTING IMPRESSION ON YOUR CAREER?
At Instinet and Reuters Americas, they were very open and willing to have people who were capable to just try new things and to work in new areas of the business.
Top 3 Current Projects
AEMI (Auction and Electronic Market Integration)
Objective:
Preparing to launch our new hybrid system for Reg NMS. Traditionally, Amex has been an auction market. As the market demanded greater certainty and immediacy of execution, we developed a solution (Auction and Electronic Market Integration or AEMI) to ensure that our members and our floor could continue to add value to the market.
Platform Consolidation
Objective:
Repositioning our other products to run on a common platform and common architecture. The Amex is a multi-asset-class facility. We have a strong options business, and we do some bond trading and structured products. We operate a large infrastructure that we will need to align with the AEMI.
Market Data
Objective:
Rearchitecting our market data infrastructure, ticker plants and market data management techniques to support the first two efforts. Market data capabilities are going to become a huge foundation for the future.
2007 Initiatives
Reg NMS Compliance
Compliance with Reg NMS will carry over to make our trading system (AEMI) fully operational and compliant with the Reg NMS trading phase by February 2007. Introducing the new trading system this year is really a ramp-up process to get all of our equity ETF and equity members fully operational in the new system prior to February 2007. Then we will support the various phases (pilot stock, all-stock, street testing and full compliance) by October 2007.
Business Continuity
A new look at business continuity is a natural by-product of our modernization efforts with AEMI and the future convergence of options. Our goal is to support a virtual trading environment to support our members and maintain our markets. We will leverage our infrastructure, our new data centers and the technology to provide the flexibility to the specialists, brokers and customers to access our market regardless of any physical limitations.
Demutualization/Compliance
There are a lot of compliance requirements with becoming a public company. The work falls into positioning ourselves for Sarbanes-Oxley compliance and working through the ability to demonstrate the control points for operating the business.
Vitals
IT Budget:
N/A
Size of Technology Team:
About 250 full-time staff across technology and operations.
Percent of IT Projects Outsourced:
A majority of the trading system development is offshore. We have partnered with a few organizations on development and operations to support our current transaction system as well as our new transaction systems. However, over the next 12 to 18 months we will be selectively in-sourcing critical development and operational functions.
Key Technology Partners:
N/A
Success Metrics:
Our methodology is more management-process-driven than metric-driven. Projects are business-sponsored. We manage performance around the business -- through customer satisfaction, time to delivery and the financial aspects on budgets. For business performance, we look at revenue, market share and product differentiation.
The market data growth is unfathomable. Between the growth in the options industry, the traffic in NMS quotes/order rates, there's going to be huge growth in the market-data distribution space. We're going to start to see a lot of advancement within quote mitigation, streaming and compression technologies. FAST Protocol (FIX Adapted for Streaming), is going to be at the forefront of a lot of these distribution models. We're going to see significant investment on data storage, data access, business-intelligence analysis, decision support systems and data distribution.
On the exchange regulatory side, there is pressure on continuing development of real-time capabilities for regulatory surveillance.
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio
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