Nasdaq Taps Machine Learning for Analytics
Global exchange operator Nasdaq plans to release its next-generation of analytics data feeds later this year.
“These solutions combine Nasdaq proprietary at-source and third party data with machine intelligence capabilities led by our teams and partners to provide new back-tests and interesting use cases,” said Terry Wade, senior vice president and head of business development and product, Global Information Services at Nasdaq.
One such partner has been Atlanta-based Lucena Research, which has been working with the global exchange operator for the past year.
“We have been working with them on a couple of different fronts,” said Tucker Balch, co-founder and CTO of Lucena Research. “One of them is essentially validating and analyzing data feeds and also looking at ways to help them with their index products.”
Nasdaq’s ultimate goal is to use machine intelligence and advanced analytics to deliver higher value products to clients, according to Wade.
The exchange has incorporated Lucena Research’s QuantDesk product into its development process and plans to include the platform’s capabilities into its final offerings.
The exchange initially used the platform to validate the characteristics, coverage, and the signal frequency of the new data feeds it is developing, according to Balch.
“If you were a Nasdaq client, you would be able to get a standardize analysis of each of these feed so that you could compare one to another,” he added.
The first feed to leverage Lucena Reseach’s quantitative analysis platform is the technical signal feed of Nasdaq-owned Dorsey-Wright and Associates, according to Balch.
The QuantDesk platform examines the 50 to 70 daily signals that the Dorsey-Wright feed provides using machine learning to turn the raw signals into actionable signals. “We discovered, for instance, that a single technical by itself is valuable, but using it in combination with fundamental factor adds additional value,” he said.
After successful tests in Europe, the bank expects a fourth quarter rollout.
Firms should first crawl and then walk before they run with AI.
It no longer economical to throw bodies at problems.
As Mark Twain might say, the demise of humans in financial services is greatly exaggerated.
Financials market post-trade processing is likely to benefit from AI ahead of blockchain.