During the past 10 years the capital markets arguably have seen more upheaval and change than they did during the previous 50 years. New ways to trade and new financial instruments have defined the past decade. Some of the innovations created new markets and new opportunities for financial industry participants, while others helped cause financial havoc.
Behind all of the changes, however, were visionary thinkers, new technology and, of course, a little bit of luck. For every innovative idea that succeeds in the market, 100 (or maybe 1,000?) never get off the drawing board. Being at the right place at the right time -- securing a single investor to stand behind a new business plan, or even a fortuitous meeting at an airport with a potential client -- can bring success to an innovator.
In financial services, the business "partner" that helps an idea become a successful innovation is sometimes one of the industry's biggest gripes: regulation. Reg ATS in 1998 helped alternative trading systems (ATSs) and electronic communication networks (ECNs) flourish, while 2005's Reg NMS set the stage for the interconnected, fully electronic equity market that we know today. The NYSE trading floor, which for more than a century was the centerpiece of the open-outcry auction market, started the past decade as the premier equity trading destination and stood as a symbol for the capital markets. Today, however, the NYSE has closed portions of the floor as almost all trading is completed electronically.
Just as regulation spurred change and innovation in financial services, deregulation over the past two decades allowed banks to create new types of financial products and experiment with previously forbidden risky investments. Of course, the new appetite for risk across the industry partially led to the 2008 financial crisis and subsequent recession that continues to loom over the world's economy.
For better or worse, however, each of these innovations was disruptive. And each had a champion.
New electronic markets, new operating systems and other types of technological innovation have utterly transformed Wall Street in the past decade. In fact, the sheer number of innovations in the space made it difficult to select the top 10 in the capital markets. But we took a shot, anyway. On the following pages, you will find profiles of the 10 innovators who have had the most profound impact on the industry in the past 10 years. While a few of the innovators are household names in financial services, others may come as a surprise. Enjoy.
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio