Over the next week we will be presenting a series of videos of the speeches and discussions featured at the London Summit 2015. If you were unfortunate enough to miss the summit, or did attend but missed out on a particular session, this is your chance to catch up.
“There’s no such thing as a gut feeling. There is such a thing as somebody who is instinctively better at pattern recognition.”
Justyn Trenner is the Global Head of Strategy at EBS BrokerTec. His seminar was focused on the application of data. Nowadays, collecting data- for example tracking your clients’ behavior- is vital to business success. Justyn explains how procuring data is one thing, but analyzing and understanding it is another. This is fundamental in making the right decisions in tune with the audience’s needs.
“Are your findings statistically significant?”
He uses interesting case studies of data collection and usage. He points out: “Data can be statistically significant, and yet completely misleading. It can also be statistically not significant, and very very helpful.” For example, test groups are statistically insignificant, yet properly chosen, can be extremely helpful.
The seminar covers the topic of pricing retail customers, and how liquidity providers are pricing brokerages. Data is essential to ensure that people are being treated consistently and fairly.
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“You make money by having unique data that nobody else does. If we put aside ‘gut instinct’, you either have unique data or you’re smarter at using your data.”
He discusses the importance of milisecond accuracy, and how it differs depending on one’s position in the industry. He discusses timestamps, and how the time it takes to transfer from a matching engine to a liquidity provider can cause a lot of time and profitability to be lost.
Justyn advises that providers be consistent in their capture of data- it’s no good capturing data approximately. He explains the importance of interrogating data with an open mind, and understanding the difference between correlation and causation.
“You can put together a dashboard where you’ll be able to see for every customer who trades with you what their trading pattern has been for the last 7 days, the last 30 days, and today.”
For brokers, liquidity providers and banks interested in procuring and analyzing data, this session is a must-watch.
Watch this informative workshop in the embedded link!