Sep 24, 2020
The cloud is important for many reasons, including improved accessibility, lower costs, and increased functionality. In a post-COVID-19 world, the cloud has become even more entrenched in the trading lifecycle across both buy-side and sell-side firms. Third-party cloud providers, such as Bloomberg, Refinitiv, and Xignite, are enhancing their market data offerings, and exchanges, such as CBOE, IEX, and NASDAQ are starting to offer access to data directly via their own cloud services or innovation partners.
A recent blog post titled Market Data Seeds the Cloud by Shane Swanson, Senior Analyst, Market Structure and Technology at Greenwich Associates touches on results from the firm's 2019 Market Data Study that make it clear that cloud-based market data is becoming more and more mainstream.
Market Data + Cloud
70% of the study respondents said it is critical that their market data provider offers a cloud-based solution. Xignite has been offering cloud-based market data since 2006 while other vendors are just starting to migrate their on-premise solutions to the cloud! Read Xignite Blog: Cloud Adoption is Several years Old - Why Are Some Vendors Just Entering the Market?
Concerns About Security
The study revealed the main obstacle to widely adopting cloud-based market data solutions is still security, while other concerns included the cost and complexity of the transition, latency, and data quality. Shane points out that the large cloud providers such as Amazon, Microsoft, and Google stake their entire business, not to mention their reputation, on ensuring their data centers and the cloud they power are safe and secure. Xignite 's tech stack is built on Amazon Web Services. AWS understands the unique security, regulatory, and compliance obligations financial services institutions face on a global scale and Xignite has integrated tools to create a compliant and secure environment on AWS. In fact, Xignite now averages an astonishing 12 billion API calls per day on AWS.
It is also important to remember that market data does not contain any personally identifiable information (PII). Although access and usage are restricted to those who license it from vendors and exchanges, market data, such as historical stock prices, is publicly available data.
Cost of Transition is a Concern
Almost half of the respondents considering a migration to cloud-based market data were also concerned about the costs of transition and the complexity of transition. Among the top cost issues when migrating market data to the cloud can be the need to rewrite applications to optimize them for the cloud, especially ones that are very complex or have a high degree of customization. But if you choose a cloud-native data management and distribution solution you can usually deploy right on top of existing feeds and keep your existing data sources. When you are ready to migrate make sure you choose a cloud-native vendor solution, such as Xignite’s Market Data Cloud platform that offers:
• Cloud-native feed handlers, storage, and processing for your current data sources.
• Cloud APIs for easy integration with digital channels and applications.
• Emulated APIs for easy deployment with legacy systems.
• System services to manage and control your data distribution and spend
Free Greenwich Associates White Paper
Learn why it is time to cut the on-premise cord on your market data.