Data Visualization

Why It's Important: Data visualization has been a favorite topic of discussion among techies for more than a decade. But over the past year it has taken on added urgency and a brand-new shine, particularly on the shoulders of the rising worldwide adoption of automated trading strategies and on-demand access to global markets. Firms that want to keep an edge must be able to process and capitalize on market anomalies in real time by analyzing massive amounts of live and historical data to power their trading decisions. In addition to being a highly valuable tool for traders -- who often follow between 100 and 150 stocks -- data visualization also is being harnessed across the board by firms operating with smaller staffs and tighter budgets to help business decision makers and overburdened IT departments draw more timely conclusions and maintain a competitive edge.

Demand for data visualization, particularly on the business side, also is being driven by executives and investors who expect the quality and excitement of iPad and smartphone visuals in even the driest financial software application. "As people get better data, there is a higher expectation from traders and researchers looking to improve the interface," says Josh Sutton, VP, asset management and investment banking, at Sapient Global Markets.

Where the Industry Is Now: Traders want tools that allow them to quickly understand market trends and instantly drill down to a micro level. Some hedge funds are using computer-generated heat maps to filter and highlight market, pricing and other data relevant to their trading strategies. Earlier this year, Thomson Reuters announced that it was joining forces with Panopticon Software, a provider of visual data analysis solutions, to embed data visualization capabilities into the Thomson Reuters Enterprise Platform for Velocity Analytics, with the aim of moving more rapidly from strategy development and testing to deployment and monitoring.

In the meantime, the cost of data visualization technologies has gone down, enabling more firms to implement the software. "In the past, a firm's ability to organize data that could enable better data visualization was very expensive and CPU-intensive from both the client and server's perspective," says John Landy, chief technology officer, IntraLinks, a provider of cloud-based collaboration and risk management solutions.

But today, new Adobe Flash-based platforms and clustering techniques, as well as more interactive performance reporting, are allowing firms to visualize huge amounts of unstructured data more efficiently and at greatly reduced costs, Landy explains. Firms are now using data visualization technologies for risk analysis, pre-trade and post-trade checks, compliance monitoring, fraud detection, client profitability analysis, research and sales, data latency monitoring, and portfolio performance and attribution.

Focus In 2012: Data visualization technologies will continue to evolve. "It's no longer enough just to create a picture -- if you watch a movie and you freeze it frame by frame, you'll have no idea of the context," says Michael J. Zeitlin, CEO of Aqumin, which has created software that enables firms to visualize data on a constantly evolving, interactive landscape. The software, called AlphaVision, uses interactive 3D visuals -- think charts that look like skyscrapers on a landscape that gradually get taller or shorter as data changes in real time. It allows wealth managers, portfolio and risk managers, and even regulators, among others, to move things around on the fly and see patterns in disparate sources of public and proprietary market data, Zeitlin says.

Industry Leaders: The Chicago Board Options Exchange (CBOE), Gain Capital, JP Morgan and many other asset management and bulge-bracket firms, as well as hedge funds, are employing data visualization.

Technology Providers: Streambase, SAS, IntraLinks, Panopticon Software, Aqumin and others.

Price Tag: According to StreamBase, its CEP solution, which includes the StreamBase Studio visual development environment, also includes application programming interfaces (APIs) to a variety of visualization technologies for applications -- such as Adobe Flex, Eclipse RCP, Java Swing, Microsoft Excel and .NET, and SL RTView -- as well as to specific data visualization vendors, such as Panopticon.