3rd Theme of SIBOS: Scalability
Strong growth in trading volumes has coincided with the increase in asset classes in recent years, with fewer firms making more trades but using fewer counterparties.This volume growth is illustrated by the following two graphs.
The first graph shows a four-fold increase over the last five years in the traditional asset class of equities on the London Stock Exchange’s Order Book. The second demonstrates the continual demand for alternative asset classes and their potential growth. Exchange traded fund assets in the US have risen from US $65bn in 2000 to nearly US $1.1tn in early 2011, an annual compound growth rate of more than 30%.
Increased volumes across asset classes, in ever-changing and potentially volatile markets, are putting a strain on post trade systems. Adaptable and scalable systems will become more and more valuable.