Chris Lee ABN Amro: An iPhone, a Global Clearer and a Data Centre
Rather than renting trading permits to traders on the floor of the exchange…… today we rent rack space in data centres. Firms no longer pay premiums to position their trading booths as close to the trading pits as possible, but rather discuss how close our data centre is to the matching engine. Those who have not managed to evolve have died. Success is a result of competitive differentiation…. no less in Asia than in any other region of the world.
So where does the iPhone fit into this?
Lets look outside the electronic trading world, and use the world of Apple, a classic example of an early starter technology company. While Apple developed hardware, its main rival Microsoft concentrated on developing software. Many would have bet money on Apple’s demise, but their survival strategy was very smart. They built their products into a platform; a platform for others to run their applications (apps) on. Testimony is the iPhone, a smart piece of kit, mimicked and copied the world over. A platform that others can access in order to write and launch apps. The real power of the iPhone is in its partners and the apps that run on it.
How does this relate to global clearing?
The most remarkable part of the evolution of the financial trading industry, is that many of the participants have essentially become technology firms. Exchanges, clearers, proprietary trading firms have all had to adapt and embrace technology.
At ABN AMRO Clearing we used to have booths on the trading floors with runners servicing our clients – we had to evolve and differentiate ourselves….Over the last 4 years we have built hosting facilities in 24 data centres globally, with 14 of those in Asia Pacific alone. We have facilities in virtually every co-location or proximity centre on the map. We have built our own proprietary state of the art high speed global trading network, using local dark fibre wherever possible, connecting Sydney, Tokyo, Singapore and Hong Kong, but more importantly linking Asia Pacific to the US and Europe. We have expanded our offering of independent software vendors to meet the requirements of our growing and demanding client base. We’ve developed all of this purely for our client base to leverage off and do what they do best… Trade!
We have essentially evolved into a platform with key partners. Our Global Network wasn’t built with one vendor; we selected the best of breed from around the world. Just as the Apple iPhone allows apps to be run over it, we allow High Frequency Traders (HFT), proprietary traders and brokers to leverage our platform in order to build their business. Our clients can utilise any component of our service, from complete outsourcing, to use of our memberships, our trading network, or just simply a single server in one of our co-locations. We have merged the world of technology provision with first class clearing and custodial services.
Our philosophy at ABN AMRO Clearing is to make it easier and cheaper for our clients to build their business. With a global trend in outsourcing we believe that firms can save significant time, effort and money, by outsourcing to platforms like ours that offer market leading global infrastructure.