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AdminSep, 27 20235 min read

7 Advanced Trading Tools You Need to Succeed in Uncertain Markets

Caught between the market’s optimism and the threat of recession, investors wonder what the rest of 2023 will bring. No matter what’s to come, will your trading desk be ready? 

As 2023 got underway, many investors in the U.S. believed the economy would soon fall into recession and, in response, the Federal Reserve would begin to reduce interest rates.  

But here we are, entering Q4, and neither of those events has happened.

Instead, interest rates remain high as the economy keeps moving along, supported by consumer spending and low unemployment.     

This turn of events leaves both asset managers and investors wondering what lies ahead for the remainder of the year. Will the current state hold, or will the much-discussed possibility of a recession come to fruition?  

In a recent survey, Ernst and Young reported that in times of uncertainty, managers and investors’ top business challenge is responding to various market risks, including public market volatility, changing interest rates, and talent management.   

One thing is clear: the remainder of 2023 will inevitably bringing both challenges and opportunities, and firms need to be ready to capture those opportunities as they arise. 

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The Right Trading Technology to Navigate an Uncertain Market 

At SS&C Eze, we spend a lot of time talking with the thousands of traders that use our platforms. They tell us that the key to success in an uncertain market is leveraging the right trading technology. By using advanced trading tools, your traders are better able to see the market, make decisions, and execute them quickly and effectively.  

Moreover, giving your traders the right tools leads to a more efficient operation and helps traders become better at and more satisfied in their jobs. 

Here are seven advanced trading tools traders need most in unpredictable markets: 

1. Flexible Trade Automation 

To get the most out of today's markets, empower your traders to focus on the things that matter most.  

Especially for trading desks struggling with headcount, using automated trading capabilities like algo wheels and automated order routing to trade low-touch orders is an excellent way to free up traders' time and get orders to market fast.   

When your traders no longer need to focus on these simple, automatable trades, they can spend more time doing what they do best: fostering relationships, finding opportunities to capture more alpha, and working more complex trades. 

This focus on more complex trading makes better use of their time and helps keep them engaged and committed to their jobs. 

2.  Fast and Streamlined Access to Liquidity 

Cumbersome or manual trading workflows slow down processes and may cause you to miss opportunities as they arise.  

Technology that provides centralized access to multi-broker aggregated liquidity and tools enables traders to dynamically manage positions, portfolios, and trading risk across global equity, futures, and options markets.  

Moreover, features that support fast and streamlined access to liquidity – like algo wheels and "hot keys" – help to get orders out to market in less clicks.  

3.  Integrated Compliance Functionality 

Compliance looms over every market, but in fast-moving markets with high volumes, compliance becomes even more challenging, and the last thing you want is cumbersome compliance workflows slowing down your trades. 

You need a system that integrates compliance functionality right into your trading workflow. This level of integration keeps traders happy with smooth-flowing trades while also satisfying the evolving requirements of your compliance team.

4.  Best Execution and Transaction Cost Analysis (TCA) 

In volatile markets, knowing if and when you are trading efficiently and effectively can often take time and effort.  

Technology is a vital resource for helping you understand your performance. Systems with built-in best execution tools like charting and market fragmentation can track and monitor your performance and help you stay on top of your obligations.  

Moreover, your system should be able to integrate with third-party TCA providers. These providers can ingest your data and offer valuable insight. 

5.  Scalability  

The ups and downs of the market mean you need to be able to capture opportunities as they arise. Doing so requires technology you can depend on to meet your needs today and scale to secure new opportunities in the future.  

Ideally, your technology provider offers a wide breadth of solutions you can deploy modularly to meet your needs as you grow. Also, be sure your technology has open APIs that let you expand functionality and create a more dynamic investment ecosystem.  

Market changes are inevitable. As your firm continuously seeks to capture new opportunities as they arise, technology will only play an ever-increasing role. So be sure your technology provider invests heavily in R&D and innovation and that they have a well-constructed roadmap aligned with your goals and ability to evolve.

 6.  Mobile Capabilities

In discussions of today’s complex and evolving markets at recent events, industry leaders shared that agility is non-negotiable. To remain agile and harness opportunities when the time is right, these managers are leveraging mobile trading capabilities.   

If you want to work at peak efficiency, you need to be able to respond to opportunities anywhere, anytime. That requires seamless access to your technology across browser, desktop, and mobile. 

7.  Client Service Based on Your Needs 

When it comes to investment technology, your vendor's service team should not only know your technology but how and why you use it.  

When considering a new vendor partnership, be sure to ask what level of service and support they provide, when they are available, and how fast they’ll return your calls.

Also, think about managed services as a way to expand your team and free up additional time for staff without increasing headcount. Your vendor's managed services team should be able to support essential, routine daily and monthly processes – all from within your existing technology platform.   

Most importantly, you want a vendor with the expertise and experience needed to become a partner to your firm now and well into the future.  

In Changing Markets, Don’t Be Left Behind 

The trader-tested technology from SS&C Eze gives you the resources you need to come out on top in shifting markets.  

But our technology and support go well beyond the front office and current market conditions. For over 25 years, Eze has been serving the investment community. We are experts in front-to-back financial technology, and we have an in-depth understanding of our clients' businesses and how technology can improve their outcomes.  

Whether you’re looking to buy, upgrade, or change trading systems, SS&C Eze's new Trading Technology Buyer's Guide is your definitive resource for understanding how to apply the trading technology available to you to navigate today’s uncertain markets and set your firm up for success in the future.