Microsoft at FIA Boca 2023: Intelligent data and the future of financial markets
Microsoft was a proud sponsor at this year’s International Futures Industry Conference (FIA Boca), which took place March 13 to 17, 2023 in Boca Raton, Florida—a key event that brings together industry elites with the firms, regulators, and various constituents shaping the future of global markets.
Against the backdrop of an already eventful year, the conference covered a wide spectrum of topics—including the industry’s resilience in the wake of multiple crises, the continuing importance of cybersecurity and risk management, managing record trading volatility, market structure innovation, the evolving role of digital assets, and reimagining the markets of the future.
Underpinning these key themes and industry trends is technology—its critical role in the industry cannot be overstated. It is front and center in all our client and partner engagements across the ecosystem of exchanges, trading firms, investment managers, and data service providers as they focus on transforming their businesses.
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A major highlight at the event was the opportunity to present our vision on the role of technology innovation in advancing the success of our clients. In our joint session with David Schwimmer, Chief Executive Officer, LSEG (London Stock Exchange Group), Bill Borden, Corporate Vice President, Worldwide Financial Services, Microsoft, led a discussion into the thinking behind our goals and innovation efforts as the industry embarks on a new era of analytics and AI-powered transformation. Let me point you to the compelling vision we shared at the event that captures different aspects of how firms will be able to connect, research, analyze, collaborate, and transact across the entire financial markets value chain.
Challenges and imperatives for capital markets firms
In the context of a complex macro-environment and challenging business landscape—and because of the persistent imperative to adapt—our clients are striving to become more efficient and cut costs on the one hand, and become more resilient and future-ready on the other. It’s a difficult balancing act.
We are witnessing a few patterns emerge as the industry focuses on enhancing its capabilities and striking the right balance. One concerns the increasing use of data by those in non-technical—or nominally, business—roles. Clients are looking to develop unique and rapid insights from the barrage of structured and unstructured data, such as environmental, social, and governance (ESG) and alternative data. In fact, in January 2023 alone, 8.47 billion contracts in exchange-traded derivatives were executed, up nearly 40 percent year-over-year.1 Consequently, there is a surge in non-professional model creators such as traders, portfolio managers, and risk analysts who use their programming expertise to efficiently express their own models and insights.
Another pattern involves the need for sophisticated, best-in-class modeling capabilities. For example, regulatory reporting is becoming increasingly quantitative, creating substantial challenges for firms that lack the required analytics infrastructure to support modeling requirements for backtesting, value adjustments, and so forth.
From data to insights—and beyond
So what are capital markets firms to do?
It has become abundantly clear from our discussions with clients at FIA Boca 2023 and elsewhere that while the data challenge is enormous, solving it leads to huge benefits across sales, trading, and capital management, as well as post-trade and settlement. An efficient data platform is a foundation for creating superior modeling and analytics services, delivering actionable business insights, and providing new, value-added services. We also note the increasing importance of harnessing the power of modern, generative AI and collaboration platforms to deliver a compelling service across several use cases such as market research, client management, sentiment analysis, fraud detection, and meeting Know Your Client (KYC) requirements. Fundamentally, then, what is needed is a secure, compliant, cloud-based platform infused with intelligence, with which capital markets firms can profoundly and confidently transform products, services, operations, and the client experience.
Microsoft has long been investing in innovative solutions of this kind for the industry—and recent announcements about Azure OpenAI, Microsoft 365 Copilot, and Microsoft Security Copilot point to a future of even more exciting possibilities. With the Microsoft Cloud, capital markets firms can optimize costs, reduce time to value, enhance collaboration, and use data and AI to deliver more impactful business outcomes—whether delivering differentiated client experiences, empowering employees, managing risk, or modernizing mission-critical core systems. The security, compliance, and scale of the Microsoft Cloud, combined with our global partner ecosystem, empowers capital markets firms to reimagine their business and offer a compelling value proposition to their clients.
Looking ahead
There is much more to discuss with respect to Microsoft’s perspectives on, and approach to, the industry. Watch this space in the coming weeks for observations and insights from my capital markets engineering partner, Adrian Crockett, who will be unpacking some of these priorities in greater depth.
Find out more
Microsoft offers capital markets firms a highly secure, enterprise-grade cloud platform and the latest technology needed to unlock business value, deepen client relationships, and manage risk. Contact your Microsoft sales representative to find out more.
