While many industries have learned to harness the power of Big Data, Capital Markets has yet to see a splash. From reducing the cost of compliance to seeking larger alpha, Big Data could be beneficial in a number of areas within Capital Markets – so why isn’t it catching on?
Big Data is normally described using Vs: Volume, Variety, Velocity, and even Veracity, but, in order for it to become more than a buzzword, firms must focus on another V … Vision. To be successful, a firm must have the vision to take time to understand the theory and principles behind Big Data before investing in the analytics, infrastructure, and people.
The arduous task of keeping up with new regulations is monopolizing budgets and tightening any leftover dollars that might have been put toward innovation. These same regulations are also making it difficult to create the same profits firms have seen in the past. Because of this, it’s becoming increasingly difficult to justify large capital investments in technology – especially given the many unknowns involved with Big Data for Capital Markets.
Without a clear vision, the outcome of Big Data analysis can be misguided. In other words, it takes forward thinking to determine what answers a firm is looking for and how they plan to turn those answers into actionable business improvements.
While other industries – and even other sectors within Financial Services – are reaping the benefits of Big Data, the Capital Markets sector is still in the early stages. The firms with vision, the ones that focus energy on identifying the right Big Data solutions for their business needs, will see the greatest impact on their investments.