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Major fintech trends in 2021

by Billy Murray
Head of Intertrader Prime

The surge in electronic trading has been fostered in previous years by two significant developments: the availability of more accurate price data, and huge growth in the number of ETFs that track a wider range of indices. In 2021, extended market volatility has truly tested the mettle of electronic trading, but the technology has generally proved to be resilient, and facilitated high volumes of seamless transactions day in, day out.

The growth in electronic trading is another result of the accelerated shift to digital-first behaviours that the pandemic has brought about.

Prospects in fintech for 2022

With the pandemic further accelerating uptake of electronic trading, it’s natural to expect providers to further capitalise on these developments in the next year to ensure their systems can handle greater capacity. Despite traders increasingly executing larger trades electronically in volatile market conditions, a factor they are becoming more mindful of is stability.

Beyond purely executing trades, electronic systems can be harnessed to source data and asset prices, communicate with dealers, track positions and analyse a trade once it has been completed. With more sophisticated, algorithmic measurement tools alongside AI, data is becoming easier to interrogate and more reliable as a result.

While the capabilities of these advanced trading systems develop, clients’ thirst for different products will grow even more. There is a risk that analytic tools within these systems may not keep up with client demands. If the market is to develop and innovate further, this technology needs to be upgraded, to include the likes of portfolio scanning systems.

This upending of the trading ecosystem raises the question of regulation for the year ahead, with regulators likely to continue to keep a close eye on how novel technologies should best be leveraged.

First published in The Fintech Times: 13 December 2021

You should under no circumstances consider the information and comments provided as an offer or solicitation to invest. This is not investment advice. The information provided is believed to be accurate at the date the information is produced.

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