@DeutscheBank: Three-Card Monte and Other Confidence Games
"Pay attention to what I say, not what I do..." More and more - over decades of practice - this opening statement has become the golden rule of marketing and communications, no matter if that "marcom" strategy is being applied in the context of finance, economics, politics - or, any other blood sport. Reason being: If you believe that perception is reality, then perception can have real economic consequences. However, with today's data ubiquity and resulting overload, we [...]
@Crypto Blah Blah and the Birth of Markets
Disintermediation. And, desperation. That's what this is really all about. Together, these drivers produce an enormous amount of hype; a mixed wave of cryptocurrency insanity (and some blockchain legitimacy) washing over the global financial landscape... These days, it seems possible to transform any topic, no matter how dry or serious, into an all-out circus. And, it can be difficult - even for those most disciplined at rationing their limited attention - to look away as the spectacle unfolds. [...]
Virtu: Q1-2018 Update on Extremes
With volatility spiking in Q1 of 2018 - and the successful porting of KCG's intellectual property (IP) prior to that in late 2017 - VIRT earned a welcomed reprieve from the conditions of recent quarters, as we predicted here (and elsewhere prior to that). In the exhibit below, Alphacution's as-if modeling of the combined entity - Virtu + KCG pre-Q3 2017 - yields a level of net trading income that would not have been seen since Q1-2016. Meanwhile, [...]
#FinTech Entrepreneurs*: This Clickbait is For You
Take a deep breath... Focus your attention... And then consider: How bad do you want it? As a fellow #fintech entrepreneur, the reason I pose the question is that mass disruption and disintermediation (of status quo business models and "analog" workflow processing methods) is already here, and accelerating. In fact, chances are, you are involved in developing a digitally-savvy venture - likely related to #AI or #blockchain or #bigdata or #IaaS or even #cryptocurrencies - right now. We [...]
Riffs Ep5 – What is Your Return on Technology?
In this latest Alphacution Riffs episode 5 - What is Your Return on Technology? - we detail how to measure and benchmark "return on technology" - a concept Alphacution developed that quantifies the performance of technology investments relative to the cost of those investments for specific companies - and then aggregates those measurements into a benchmarking framework for a broader sample of companies. Leveraging our model library and analysis on 60 of the largest global banks since 2005, [...]
@GoldmanSachs, @RBC: First to Put the #GFC in the Rear-view Mirror
Before we dig into the latest numbers, let's level set the motivations here because, in the helter-skelter nature of most people's day, some of this analysis tends to get brushed aside as pedestrian. There is only so much one can do to make a headcount index sexy and provocative. But, this is something folks should be paying attention to. Banks are the biggest employers, the largest providers of services, and the most voracious consumers of technology in the [...]
Aite Group Publishes Alphacution’s Asset Manager Tech Spend Study (Press Release)
< Originally published by Aite Group > According to Aite Group’s data and analytics partner, Alphacution, technical and human capital leverage benchmarks can be developed to represent a framework with numerous practical applications for all asset managers. Boston, April 25, 2018 — Understanding patterns in firms’ technology consumption offers unique insights into shifts in both business strategy and operational efficiencies. But the main challenge in discovering technology consumption for the asset management universe is that these firms are mostly private, [...]
What Does Citadel* Spend on Technology?
Take a deep breath... Focus your attention... Now, consider that there are only about five people on the face of the planet who actually know the answer to our opening question - What does Citadel spend on technology? Moreover, someone would likely need to hold one of these folks at gunpoint for that executive to spill those beans. The same scenario plays out for a firm like Millennium or DRW or Jump Trading or Two Sigma or IMC [...]
Alphacution Publishes Groundbreaking Asset Manager Technology Spending Study
Alphacution has devised a method to arrive at the most highly credible estimate for what any asset manager spends on technology, no matter their level of financial disclosure. And, the implications for that discovery are huge... Clearly, this is a bold, provocative - if not, entirely ludicrous - claim. And yet, we still make it, out here in the open, with confidence - thanks to our collection of data. Here's why: There is a persistent relationship between assets [...]
Riffs Ep 4 – What Do Hedge Fund Managers Spend on Technology?
Set aside some time to watch Alphacution Riffs Ep 4 wherein we walk through the foundational hypothesis; key highlights; an extraordinary case study involving Citadel, Millennium Management, Point72 and Vanguard (teaser); and, the strategy behind the release of our latest - and, most impactful - study to date, "The Context Machine: Estimating Asset Manager Technology Spending" (April 2018). And, for those of you with a slightly longer attention span, stick around for another "public service announcement" at the [...]
