The week started with temperatures in the 80s and a sunny outlook, but given the way Chicago can change, it wasn’t a huge surprise to see a 30 degree drop over the course of the event. In fact, the weather seemed to mirror the ups and downs of the industry over the last twelve months.

Sunny spells, patchy clouds and a typhoon of data

The 32nd annual FIA Expo in Chicago was, as ever, full of commentary and observation as the industry looked back on the last year and forward to the next.

The week started with temperatures in the 80s and a sunny outlook, but given the way Chicago can change, it wasn’t a huge surprise to see a 30 degree drop over the course of the event. In fact, the weather seemed to mirror the ups and downs of the industry over the last twelve months.

With this backdrop, the topics ranged between uncertainty over Brexit, through to the markets’ ability to survive and flourish via innovation and adapting to change.

Regulation and its effects were well represented and there were signs of some positive and sensible collaboration between the various parties – not least regarding Reg AT and some EMIR changes over reporting demands. One of the big issues, naturally, continued to be capital requirements for banks in the clearing arena, with the outcome still uncertain.

Data as a commodity

‘Data’ was also covered in detail, and it’s evident that the sheer amount of it flowing through the industry continues to grow. The commercial value of data and its ultimate ownership got a lot of airtime and this is clearly an area of every business that is under far closer scrutiny.

One of the exchange leaders gave an example of how he gets regular alerts from his cellular supplier to ‘buy more data’ as he travels around the world. One swipe and extra megabytes become available in an instant. The only challenge is trying to work out the next month’s bill…  

The same exchange head also made the point that their first exchange once had just four products. It now has over a thousand and even greater daily volume multiples – that’s a lot of data growth!

Control is key

Data has an inexhaustible supply and the cleared derivative industry is having to consume, analyse and evaluate more and more of it either to comply with regulation or to use as a vital source of revenue and competitive differentiation.

Not so long ago, data was a necessary evil of the industry, stored away in dark data centres. Even today, we still see boxes and boxes of printed statements poured over by legions of staff, marker pens at the ready, while an array of spreadsheets are built.

Digitisation and optical character recognition services at one end of the scale are now finally starting to make some significant in-roads in some areas, and at the other some sophisticated data tools are being utilised.

However, keeping pace with the storm of data needs new thinking – particularly if firms want to turn large amounts of it into a valuable commodity and significant value for their businesses. The fundamental question is: just how in control of their data are the participants today?