Capital markets firms spent over $1.4 billion on consolidated market data feeds in 2017, up 17% from two years ago.
That increase comes despite new competition from direct data feeds and growing concerns about costs associated with consolidated market data. While consolidated feeds are primarily “displayed” via market data terminals, client websites, and order and execution management systems, they also play a role in “non-displayed” machine-driven activities, such as algorithmic trading.
“Trading and investing would grind to a halt without accurate, comprehensive and fast market data,” says Dan Connell, Head of the Greenwich Associates Market Structure and Technology practice and author of a new report presenting the results of a special study of 201 market data professionals and users globally. “Even with the growth of direct feeds, demand remains strong for consolidated market data.”
According to the Greenwich Report, Consolidated Market Data Feeds Thrive Despite Rising Data Fees, nearly 80% of spending on consolidated feeds is done with the top three providers in the space: Thomson Reuters, Bloomberg and ICE.
“Thomson Reuters is the incumbent and established market leader, Bloomberg has made huge strides in expanding its consolidated feed business over the past five years, and ICE’s acquisition of Interactive Data, and subsequent investments in the business, made them a player overnight,” says Dan Connell.
When it comes to future use of consolidated feeds, most firms expect to spend more for this data. Nearly three-quarters of the research participants expect their spending on consolidated feeds to increase in the next 12 months.