TT Connects with Brian Cassin and Alex Mirarchi, AWS
For more than 15 years, Amazon Web Services (AWS) has worked closely with Trading Technologies on our cloud adoption journey. While the TT platform’s primary foundation is hosted in colocated data centers, we leverage AWS’s cloud infrastructure to complement the core platform. We recently talked with AWS’s Brian Cassin, Head of Market Development for Capital Markets, and Alex Mirarchi, Principal Capital Markets Industry Specialist, about how firms can get ahead using the cloud and where the impact of cloud technology is being felt most in financial markets today.
What has driven the adoption of the cloud across capital markets?
Brian: Cloud computing has become an accelerator in modern financial markets, driven by several critical factors. Capital markets institutions are increasingly turning to AWS to address challenges such as escalating data volumes and market volatility, which demand sophisticated data lake architectures and high-performance computing capabilities for artificial intelligence (AI)/machine learning (ML)/generative AI (GenAI) applications and investment modeling. Additionally, the limitations of legacy infrastructure and siloed data systems, combined with intense competitive pressures, are compelling firms to seek cloud-based solutions that enable better data integration, enhanced automation and superior customer experiences.
The cloud’s ability to deliver remarkable scale and agility has transformed how financial institutions operate and innovate. Unlike traditional on-premises infrastructure, which can require months of lead time for hardware procurement and setup, the cloud enables firms to rapidly prototype, test and launch new products and services. This agility, combined with the ability to scale resources dynamically and access cutting-edge technologies cost-effectively has become a crucial competitive advantage in today’s fast-evolving financial landscape. The cloud’s secure and flexible environment allows institutions to respond swiftly to market opportunities while maintaining operational efficiency and controlling costs.
How has the industry’s view and embrace of the cloud changed over time?
Brian: Attitudes toward cloud computing have evolved dramatically over the past decade, particularly regarding security and compliance. While some capital markets firms initially approached cloud adoption with caution, AWS’s experience in serving financial institutions has helped reshape this perspective. With over 143 security standards and compliance certifications, AWS has demonstrated its commitment to meeting and exceeding the stringent requirements of highly regulated industries. This transformation is evidenced by numerous industry regulators who now publicly acknowledge their own AWS usage, validating the platform’s security credentials.
AWS’s comprehensive security approach combines robust infrastructure protection with innovative tools and services, setting the industry standard for cloud security. Our sophisticated security features include Virtual Private Cloud (VPC) capabilities, end-to-end encryption for data both at rest and in transit, and advanced Identity and Access Management (IAM) tools. These security measures, backed by dedicated teams of security and compliance specialists, have earned the trust of financial institutions worldwide for well over a decade. AWS’s security-first mindset, coupled with continuous innovation and investment in protective measures, has effectively addressed the robust security and compliance requirements of capital markets firms, enabling them to confidently migrate their most sensitive workloads to the cloud. This security foundation is complemented by AWS’s extensive global infrastructure, which provides the scale, reliability and availability that financial institutions require for their mission-critical operations.
There’s been a massive rise in the amount and use of data throughout our industry. How does the cloud play into this?
Brian: Trading volumes have grown exponentially in recent years, accompanied by increased electronification across markets, particularly in fixed income, currencies and commodities (FICC) markets. This evolution has created a surge in data that firms must process and analyze in near real-time. Cloud computing has emerged as a pivotal solution, providing the computational agility and innovative capabilities needed to handle these escalating demands efficiently.
The cloud’s economic advantages have proven equally compelling. While legacy systems typically involve substantial capital expenditure and complex maintenance requirements, AWS’s consumption-based model offers a more strategic approach to resource management. Organizations can now access sophisticated data management tools and extensive computing resources while optimizing costs through dynamic scaling. This flexibility allows firms to align their technical infrastructure precisely with business needs, eliminating the traditional risks associated with forecasting and pre-purchasing hardware capacity. Furthermore, the cloud’s inherent efficiency in data organization and management has enabled firms to accelerate innovation while maintaining cost discipline – a critical advantage in today’s competitive market landscape.
How is AWS helping to modernize the trade life cycle?
Alex: As a result of the business benefits provided by the cloud, capital markets firms are rapidly modernizing the trade life cycle on AWS. They are accelerating quantitative research and strategy identification processes, transforming trading platforms, scaling market surveillance and risk compute grids, and streamlining core settlement and clearing workflows at an increasingly rapid rate.
The ability to process and analyze data at previously impossible volumes has combined with the development of AI to deliver exponential productivity gains.
While generative AI is still in its relative infancy, the technology has already proved a game changer in several areas, bringing the ability to aggregate, dissect and interrogate vast data sets. Capital markets firms are increasingly integrating generative AI and traditional AI across multiple workflows to transform their businesses.
Bridgewater Associates, for example, has used AWS to build a secure, large language model (LLM) powered investment analyst assistant that can compute financial indicators and create summaries of the results as well as create charts based on both minimal and complex queries.
Nasdaq leveraged AWS’s AI platform to launch the industry’s first AI-order type, D-MELO, which has shown a 20.3% increase in fill rates and an 11.4% reduction in mark-outs.
Jefferies partnered with AWS to modernize their post-trade processes and built an AI-powered solution that reduced processing times by 80-90% and increased accuracy, with minimal human intervention.
While the AI-powered use cases across the trade life cycle are seemingly infinite, a common thread is that with the cloud, the technology and tools that previously were available to the select few are now accessible to all firms across the market.
The elasticity, scalability, on-demand access to a wide range of resources, including machine learning, and the ability to go global within seconds have changed the way capital markets firms are thinking about their entire portfolio from pre-trade, at-trade and post-trade.
The potential of the cloud is only just beginning to be realized, and it will ultimately revolutionize financial markets in ways that are not apparent today. Although exactly how this will unfold remains unclear, one thing is for sure: we will continue to be at the front of the pack among the innovators, delivering cloud-based solutions to our customers to help them grow and optimize their businesses.