AI, Machine Learning Will Drive Market Data Consumption

§ 01 Executive Snapshot

• What: Majority of asset managers view AI and ML as crucial for market data consumption.
• Who: SIX, Crisil Coalition Greenwich, asset managers, wealth managers, and private banks.
• Why it matters: This trend indicates a significant shift towards technology-driven data consumption in financial markets.

§ 02 Key Developments

• 80% of asset managers view AI and ML as key drivers of market data delivery in the next two years.
• 65% of respondents utilize real-time data throughout the trading day, indicating a rise in 24/7 trading.
• Almost 70% expect a 1% to 5% increase in budget spending on market data.

§ 03 Strategic Context

• The annual Market Data Study has been tracking trends and challenges in market data consumption for three years, highlighting the growing significance of technology in finance.
• The increasing reliance on cloud infrastructure for data delivery reflects a broader trend towards scalability and efficiency in financial services.

§ 04 Strategic Implications

• Immediate consequence includes a shift in how firms receive data, favoring market data vendors over direct-from-source data.
• Long-term implications suggest that firms prioritizing technological advancements in data delivery will gain a competitive edge in the industry.

§ 05 Risks & Constraints

• Potential risk includes the need for robust data management practices to ensure data quality and compliance amidst growing regulatory scrutiny.
• Competition from firms that successfully integrate advanced technologies could pose challenges for those lagging in AI/ML adoption.

§ 06 Watchlist / Forward Signals

• The upcoming budget cycles and spending trends for 2025 will be critical to watch for signs of continued investment in market data.
• Future developments in AI and cloud technologies will signal the success or failure of firms in adapting to the evolving market data landscape.