In marketing, we talk about product lifecycles and most often, the theory of diffusion of innovations is used to explain market growth, shifts, and declines. This theory, developed by Everett Rogers, attempts to explain how innovations are communicated among people in a social system. Others have attempted to bring forth modified ideas, like Malcom Gladwell in The Tipping Point, but despite being introduced in 1962, Rogers theory continues to hold its own, especially when looking at his “categories of adopters.”
Topics: Financial Analysis
Information technology groups for the finance sector are unique in many ways, perhaps mostly regarding the need to make quick decisions using very large sets of data. Top performance can quickly position a company just right for market conditions. Like other industries, many financial services companies are turning to the cloud to increase computing capacity, but deciding how and when to use it continues to be topic of debate. In a few weeks, we will test the pulse of cloud adoption at the FIA Futures & Option Expo in Chicago to determine what has changed in financial services firms.
Last year at FIA, a panel openly discussed use of the cloud. In it, a few key points were summarized:
- While cloud services were being heavily leveraged, the participating panelists supported a hybrid infrastructure model so that workloads demanding ultra low-response times (microseconds) could run “on-metal”.
- Amazon Web Services users dominated the panel, with little mention of secondary or alternatives being tested.
- Panelists overwhelmingly agreed that cloud security was likely better than that of their in-house data centers.
Market forces and increased volatility are challenging financial service organizations to make changes that allow for operational efficiencies. How companies go about doing that varies widely, but the once shunned idea of using cloud service providers is becoming more and more attractive. Cloud resources can change the possibilities with nearly unlimited compute resources minutes away from deployment.
Hedge fund and investment managers seek better returns by analyzing many external datasets impacting the market. These analytics are driving decisions; however, most often the key resources on which the analysis depends are provided by the IT department — computing, networking, and data storage access.
As we head into a week of industry-specific conferences, the prediction of the rise of high-performance computing becomes reality. HPC Wall Street and Bio-IT World are not your typical Supercomputing conferences attended by those who work for supercomputing centers married to academia or national laboratories. These conferences are filled with systems engineers and IT professionals living in an HPC environment that was only recently built to support new demands.
Financial services workloads require massive compute and storage resources. Finance IT organizations are faced with finding solutions that meet this demand by providing simpler, faster, and more economical access to both enterprise data centers and, more recently, cloud-based infrastructures. When built, analysts can run more simulations in less time, store more market data at reduced total cost of ownership (TCO), and run larger, more complex risk and backtesting models with the compute scale needed to return results within demanding timeframes.
Clients in this space are finding Avere file system and caching technology a perfect fit to accomplish these goals. In our recently released white paper, Winning Three Ways: Avere Hybrid Cloud NAS for Financial Use Cases, we dive into three use cases heating up in Wall Street technology.
With more market data inputs and emerging regulatory requirements, the necessity to use more compute resources for financial models is expanding rapidly. Satisfying this demand means investing substantial capital dollars in IT infrastructure.
Alternatively, the case can now be made that low cost cloud computing resources can now be used for bursty workloads.