According to a recent survey, 79% of financial professionals believe that market data quality is an issue for their organisations.
The survey, conducted by Xenomorph at SIFMA in New York City, June 10 - 12, polled financial professionals about their experiences with market data. More than half of the respondents spend significant amounts of time validating data rather than on productive analysis to gain competitive advantage.
With markets growing more volatile and financial organisations turning to complex, multi-asset trading strategies for an edge, the need for clean, accurate market data has never been stronger. According to the survey, fewer than one in four financial professionals classified the quality of their market data as very good or excellent - an alarming number in a financial environment that has become increasingly averse to risk.
In addition to adding unnecessary risk, poor quality market data can have a significant impact on organisational resources. According to the survey, 20% of asset managers, investment bankers and hedge fund professionals spend between 25%-50% of their time validating data. This massive investment of time and effort on manual data manipulation and analysis would be better spent on tasks that contribute directly to their organisation's bottom line.
"Over past months, there has been much discussion within the financial services industry about the need to improve risk management processes - whether it is to satisfy a regulatory need, or strengthen internal risk control," said Brian Sentance, CEO of Xenomorph. "Given these pressures, the biggest risk any financial organisation can take is to base its decisions on stale or bad market data. Even the most sophisticated of risk models are worthless if they are being fed by dirty and incomplete data."