If you want to position yourself for a trading job in an investment bank or buy-side firm in future, there is one skill that will get you through the door: data analysis. Finance industry employers now value it above all else.
So says a new survey of 107 capital markets professionals from research firm Greenwich Associates, most of whom were based in North America. Forget market knowledge and client relationships. The future belongs to the data guys.
The chart below depicts the new priorities for trading desks according to the survey responds. Number one is data. Number two is market structure knowledge. General market knowledge comes a poor third.
The new data-emphasis is already in evidence and will become more prevalent in time. Sell-side trading desks (in banks) will be all about examining 'customer trading patterns more systematically to help with relationship management,' will 'use execution algorithms that include an AI component to source liquidity' and will 'digitally communicate with clients even more than they do today' (thereby creating even more data), says Greenwich. At the same time, asset managers on the buy-side will use data to look for investment opportunities, to price illiquid assets and to manage risk.
If you're not a data analyst (and even if you are), it will also help to know about market structure. Greenwich defines market structure as, "the impact of regulations, technology innovation and behavior changes on the market and its participants.” If you're a trader, it says this means knowing how regulations, technology and behaviors affect trading and how changes to them can impact a business.
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