Thursday May 23, 2019

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Cloud Computing Rises on Wall Street

Image representing Scivantage as depicted in C...

Image via CrunchBase

Lower trading volumes and less than stellar profits mean that Wall Street firms are looking to cut costs, so the adoption of third-party cloud-based applications and services is expected to accelerate this year.

Scivantage runs  a retail online-trading portal and professional trading and tax applications in a private cloud. Joe Stensland, SVP and managing director of Scivantage, told Wall Street Technology that, “We deliver the application with a private cloud and allocate the resources needed for each client deployment so they don’t have to bring in resources and infrastructure,

While the interest in cloud services is moving up the list of priorities at large firms that have become cost-conscious, according to Stensland, “Midrange firms have become even more interested in the cloud’s pay-for-what-you-eat philosophy.”

The cloud helps firms’ ability to cope with capacity planning. Financial firms have to be prepared for sudden bursts, but don’t want to incur the costs unless they need it. But with the could, they have “burst-ready” capacity—which is more critical than before due to increasing market volatility.

Concerns about privacy and security mean that some firms refuse to let client data leave the facility. But some firms are migrating to private clouds managed outside their data centers.

Bob Guilbert, managing director of Eze Castle Integration, a private cloud provider to hedge funds, said cloud services offer high availability and robust security without firms increasing IT head count, storage and networks. He told Wall Street Technology that, “We still see the business trending heavily toward the cloud, based on the benefits that people get — lower cost on the infrastructure and maintenance, and they don’t have to do a technology refresh.”

Financial firms have not been using public cloud infrastructures offered by Amazon Web Services, Google or Microsoft, which offer huge economies of scale and can shift workloads to virtual servers all over the world. Wall Street firms are staying with private clouds.

Bryan Thompson, VP of services at Tier 3, which provides public, private and hybrid cloud solutions, told Wall Street Technology that high-frequency trading is not conducive to public cloud infrastructures. But post-trade analytics that consume a lot of market data—without real-time data—are good candidates for cloud-based infrastructures

Guilbert says that a public cloud is a multitenanted infrastructure where everything is shared. But private clouds have dedicated infrastructure, including dedicated storage. “It’s either a security trade-off or a price trade-off,” Guilbert told Wall Street Technology.

Wall Street Technology