Trading and the Portfolio System Suite: A Survey

June 15, 2005

Abstract

New York, NY, USA June 15, 2005

Trading and the Portfolio System Suite, a Survey

Celent estimates that total market spending for trade order management systems was US$445 million as of 2004, and that total spending will reach US$701 million in 2007.

In a new report, Trading and the Portfolio System Suite, a Survey, Celent conducted an industry survey regarding the use of trade order management systems, portfolio management and accounting systems within the asset management community. Participants included traders, portfolio managers, and technology staff at the firms. The survey included more than 40 questions in the following areas:

  • Interest in and purchasing intentions for trading systems.
  • Trading system use, experience, and purchasing rationale.
  • Portfolio system use, experience, and purchasing rationale.
  • Interest in integrated trading /portfolio systems and ASP implementations; system switching considerations.

According toDenise Valentine, Celent analyst and author of the report, the market spending figures reflect the downward pricing pressures as portfolio system providers and other solution providers, some with fewer functionalities, become more aggressive in this market. Those asset managers with tighter budgets or low trade volumes will make do with lowest-cost alternatives. However, the overriding effect is more automation, for every size and type of manager.

These figures include the trading modules of portfolio management systems such as Advent, Financial Models Co, SunGard, Linedata Services, the pure trading system providers such as Charles River Development, Macgregor and Latent Zero, newcomers that focus purely on execution or trading strategies such as FlexTrade and Portware, the sell-side trade vendors now targeting buy-side such as GL Trade, and broker-dealers offering an OMS capability to clients.

Integrated trading and portfolio management system suites will be critical enablers of broader access going forward, and the march has begun. In evaluating the survey results as a whole, Celent concludes there is a growing demand for an integrated, multi-asset class trading and portfolio system suite. While the best-of-breed option will remain attractive to some— primarily larger organizations—we believe a growing number of asset managers will lean toward integrated offerings in the future. Because of varying deployment preferences among firms and improving vendor experience in servicing ASP, an integrated solution should be made available for both an in-house installation and an ASP option.

This 32-page report contains 20 figures and one table. A table of contents is available online.

All Members of Celent's research services can download the report electronically by clicking on the icon to the left.  Non-members should contact info@celent.com for more information.

        

Send mail to info@celent.com with questions or comments about this Web site.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

 

New York, NY, USA June 15,  2005

Trading and the Portfolio  System Suite: A Survey

Return to report Abstract

Executive Summary 3
Market Trends in Trading Systems 4
Survey Overview 7
  The Survey Participants 7
  Operational Structure and System Selection 8
  Front-Office Staffing 9
The World of Trading Systems 10
  Purchasing Considerations for Trading Solutions 13
  Trading Technology and the Swelling SMA Market 15
  The Fix Connection 16
  Electronic Trading Activity 16
Portfolio System Suites 19
  Purchasing Considerations for Portfolio Systems 22
An Integrated Future 24
  The ASP: Hype or Happening? 26
Concluding Thoughts 29
Objectivity & Methodology 30

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