Part 1: What the Infrastructure Needs to do
Trades and Products
Where do Trades Come From?
The Purpose of the Infrastructure
Part 2: The Problems with Trade Processing Infrastructure
The Evolution of Technical Complexity
The Regulatory Challenges
The Complexity Cycle
Part 3: Historic Approaches to Transformation
Functionalisation, aka “Factories”
The Golden Middle
Part 4: New Approaches to Infrastructure
Cloud and Utilities
Artificial Intelligence and Robotics
Big Data and Analytics
Blockchain/Distributed Ledger Technology
Distributed Ledger Technology: Hybrid Approach
Happy families are all alike; every unhappy family is unhappy in its own way.
– Leon Tolstoy, Anna Karenina
A great many senior managers, consultants, regulators and actual end-users of trade processing systems think there is something wrong with them. The belief that there is something wrong has spawned billions of dollars of change projects to transform infrastructure. However, many users come to work each day and book or process their trades with little complaint. Whatever your perspective, this chapter is necessary reading because it provides a comprehensive (yet concise) view of all the relevant problems (real or imagined). It also looks at the symptoms and many of the drivers of the problems. This chapter should not be used an indictment of everything that is wrong, but rather a tool to help consider which of the problems are present in your organisation, how significant they are and whether they are worth fixing.
THE PROBLEM OF TRADE PROCESSING
The financial sector, and in particularly the large investment banks, can process vastly more trades, more quickly and at lower cost than in previous decades; they can also support products that decades ago could not even