Gold-i is a global market leader in trading technology, helping hundreds of multi-asset brokers to transform their trading operations with robust liquidity management solutions, award-winning MetaTrader Plug-ins, business intelligence tools and all with the best support in the industry. Gold-i has won over 20 trade awards in recognition of its innovative products, commercial success and future potential, including a prestigious Queen’s Award for Enterprise 2014. Has been recognised as one of the most influential Fintechs in 2018 and 2019.
Interview with Tom Higgins: The Age of Data
What is the importance and value of data in the Financial Markets sector? Learn about the evolvement of Blockchain, the latest trends in ALT data and its benefits and much more in a recent interview with Andrew Saks from ETX and Tom Higgins, CEO of Gold-i.
What are the latest trends in Alt Data?
"One trend we are seeing are Funds that are interested in data showing what people are spending money on if they've got some spare cash.
An example I can share of this is a company that we are currently working with that runs many entertainment venues which monitors the number of bookings received. This data is valuable as it can show a direction and pattern of spending that people are moving towards, which can help determine whether certain stocks will increase or decrease. This data set is also getting significant interest from Funds that want to see if there is a positive sentiment for people spending money outside of essentials. It's almost a derivative of the first sets of data, but Funds want to spend an enormous amount of money on this type of thing.
Because of this growing market, Gold-i developed an entire piece of software, called Data Switch, purely for delivering alternative data of any format, not just Financial Services data."
What are the benefits of Alt Data?
Tom: "One great thing about alternative data is that it's not exposing anyone's personal information, which is the worry that most people always have. With Gmail, Google knew everything about you as a person. Now, what's been very strong in the Alt data sector world is none of that GDPR or personally identifiable information - as the Americans call it - is available. All of that data has to be stripped out, anonymous and non-reversible, i.e. you won't be able to track it back to an individual.
You are just looking at trends. You can learn, for example, if 50% of people want to buy something, which you can use at a higher level to study the market and see which sectors are strong. You don't care who these people are because you're not looking to target them personally. So, there isn't a risk from the GDPR standpoint; you're just extracting value without any downside at all."
Andrew: "That's right, and I think that what we can conclude from the exciting and comprehensive way that data has evolved is that we, in the Electronic Financial Services sector, across all components, are innovators of the new world of data. Our industry is at the top end of the innovation for the funnelling, harvesting, data production and creation of these data-based companies."
What is Exhaust Data?
"There is a term used in the alternative data world called exhaust data. It's called exhaust data based on the concept that it can be similar to the unneeded smoke that leaves a car exhaust, which most forget about as it doesn't have any value.
However, if you look at all the millions of companies in the UK, they all have systems that pump out a wide variety of data that also seems to have no value. It may be an accounting system or CRM system, but some system usually captures data that is never used. It just sits there in the system. The business moves on to the next year and continues to ignore everything from the previous years - just like the car exhaust.
Most do nothing with that exhaust data. But, it can have significant value that you may not realise and become another revenue stream. It holds significance not only for your own business but others operating in the Financial Services, such as Hedge Funds, who can benefit from this type of data and, therefore, are willing to pay money for it."
The new way to receive Market Data for brokers
"Another area of data that I think is going to expand is Price Data. We partner with a great company called United FinTech who uses an attractive model that I've not seen before. The model works whereby they invest in multiple promising companies that produce technology in the Financial Services space and employ salespeople who can sell into institutions and use the magnification factor to grow.
They've bought a company called TTMZero that produces very clever Financial models that can generate prices from bank derivatives pricing, meaning you can distribute that in a much more efficient way. We're taking that data and making it into something that you can use in a trading platform. This raw data can then be pumped through our Matrix solution, making it wholly usable and validated."