2011 WFE-MIT Exchange Technology Workshop

WFE-MIT Exchange Technology Workshop        

 
Hosted by  MIT
November 21-23, 2011
Cambridge, MA
 

 
Monday 21 November
 

 

9:00 – 9:15
Welcome remarks and introduction
  • Peter Clifford, Deputy Secretary General, World Federation of Exchanges
  • Tony Knopp, Senior Industrial Liaison Officer, MIT
  • Sheri Brodeur, Senior Industrial Liaison Officer, MIT
 
9:15 – 10:15
WFE Session - Next trends on hardware and software for exchanges
Exchanges systems changed drastically during the last decade evolving from non-stop hardware to high availability cluster, from proprietary to open systems (Linux...), from X25 to TCP/IP, and using more and more standard protocols like FIX.
Given these evolutions, what are the next trends for trading engines, market data dissemination systems, communication networks? What are the implications of growing competition among trading venues, and the race to latency?
This panel will discuss the current and future trends for exchanges IT systems.
 
 
10:15 – 11:00
MIT Session - Why Nations Fail
 
Daron Acemoglu, James R and Elizabeth Killian Class of 1926 Professor in Applied Economics
Daron Acemoglu studies political economy, economic development and growth, technology, income and wage inequality, human capital and training and labor economics, among other fields. He has taught economics at MIT since 1993. Previously, Acemoglu was a lecturer in economics at the London School of Economics, where he also received his M.Sc. and Ph.D.
 
Acemoglu is a fellow of the Society of Labor Economists, a fellow of the American Academy of Arts and Sciences, a fellow of the Econometric Society and a fellow of the European Economic Association. He is the author of Introduction to Modern Economic Growth.  
11:00 – 11:30
Coffee break
11:30 – 12:30
WFE Session – IT security for exchanges
 
Security has always been a key issue for exchanges. As exchanges have evolved from proprietary networks and systems to more open architectures, are there new risks for exchanges?
 
Exchanges are a critical component of the financial infrastructure and as such could be targeted by hackers or other activists, if not terrorists. What are the risks today?
Exchanges have also developed new services based on the internet, some of which have been recently attacked or threatened. What is the adequate level of security and what protection can be implemented?
  • Jerry Perullo, Vice President, Information Security, IntercontinentalExchange ICE
  • Todd Furney, Director of Information Security/Disaster Recovery, CBOE
12:30 – 13:30
Lunch
13:30 – 14:30
WFE Session – Turning exchanges into IT providers
 
As some exchanges have built up impressive infrastructure, are they evolving into IT providers for their members or even looking for further diversification by using their excess capacity? Is the infrastructure put in place by some exchanges the premise of the development of cloud computing for some non-core IT functions for certain financial services (and even core mission in the future)?
 
Beyond the infrastructure, some exchanges have also developed a brand new range of services to their community (members, issuers, investors). What are these services and how can exchanges diversify further their sources of revenues beyond trading revenues?
What are exchanges clients’ demands and how can they offer new services to satisfy those new needs?
  • Steve Rubinow, Chief Information Officer, NYSE Euronext
  • Carl-Magnus Hallberg, Senior Vice President, Global IT Services, NASDAQ OMX
  • Brian Healy, Director of Traded Markets, Development, Operations, Irish Stock Exchange
 
14:30– 15:30
 
WFE Session – New IT challenges for clearing organization
 
The growth of trading volumes, the growing importance of risk management and the rise of HFT trading has obliged clearing houses to review their organization and move towards real time risk management. What are the implications in terms of IT for clearing houses? What are the investments needed for clearing houses to be able to continue to perform their essential role of mitigating risks?
 
As OTC derivatives are pushed to clearing houses, is the current infrastructure ready to cope with the increased complexity of products and the growth of volumes and operations?
  • Larry Tabb, founder and CEO, TABB group
  • Rob Gambardella, Managing Director - Application Development, Depository Trust and Clearing Corporation
  • Ray Tamayo, CIO, Options Clearing Corporation (OCC)
15:30 – 16:15
Coffee break
16:15 – 16:45
 
MIT Session – Security in the Cloud
 
Nickolai Zeldovich, Douglas Ross (1954) Career Development Assistant Professor of Software Technology
 
Nickolai Zeldovich is Douglas T. Ross Career Development Assistant Professor at MIT's EECS department and a member of the Computer Science and Artificial Intelligence Laboratory. His research interests are in building practical secure systems, from operating systems and hardware to programming languages and security analysis tools. He received his PhD from Stanford University in 2008, where he developed HiStar, an operating system designed to minimize the amount of trusted code by controlling information flow. In 2005, he co-founded MokaFive, a company focused on improving desktop management and mobility using x86 virtualization. Prof. Zeldovich received a Sloan fellowship in 2010, and an NSF CAREER award in 2011.

 

 
Tuesday 22 November
 

 

9:00 – 9:45

MIT Session - The Atlas of Economic Complexity

Cesar Hidalgo, Asahi Broadcast Corporation Career Development Assistant Professor in Media Arts and Sciences

César A. Hidalgo is an assistant professor at the MIT Media Lab, and faculty associate at Harvard University's Center for International Development. Before joining MIT, Hidalgo was an adjunct lecturer in public policy at Harvard's John F. Kennedy School of Government, and a research fellow at Harvard's Center for International Development. Hidalgo's work focuses on improving the understanding of systems by using and developing concepts of complexity, evolution, and network science; his goal is to help improve understanding of the evolution of prosperity in order to help develop industrial policies that can help countries raise the living standards of their citizens. His areas of application include economic development, systems biology, and social systems. Hidalgo is also a graphic-art enthusiast and has published and exhibited artwork that uses data collected originally for scientific purposes. A native of Santiago de Chile, Hidalgo holds a PhD in physics from the University of Notre Dame and a bachelor's degree in physics from the Pontificia Universidad Catolica de Chile.

 
9:45– 10:45

MIT Session – Media Lab Tour

Joost Bonsen

Lecturer, MIT Media Lab & Founding Research Fellow, MIT Program in Developmental Entrepreneurship

Joost is an innovation ecologist studying global transformations at the level of invention in research labs, action in entrepreneurial ventures, and the orchestration of innovation ecosystems generally. He is co-founder of the Howtoons Project which distributes educational cartoons which show kids everywhere "How To" build things. He finished the Management of Technology program at the MIT Sloan school with his thesis "The Innovation Institute: From Creative Inquiry Through Real-World Impact" at MIT. Prior to MIT Sloan, Bonsen ran the MIT Founders Project which quantified the economic impact of MIT-related entrepreneurs. Joost did his Bachelor's in Bio-Electrical Engineering also at MIT.

10:45– 11:15
Coffee break
11:15– 12:00

MIT Session – Building Real Time Economic Indicators, Billion Prices Project

Roberto Rigobon, Sloan Society Fellows Professor of Management, Applied Economics

Roberto Rigobon is the Society of Sloan Fellows Professor of Applied Economics at the Sloan School of Management, MIT, a research associate of the National Bureau of Economic Research, a member of the Shadow Committee for Financial Regulation in Latin America, and a visiting professor at IESA.

Roberto is a Venezuelan economist whose areas of research are international economics, monetary economics, and development economics. Roberto focuses on the causes of balance-of-payments crises, financial crises, and the propagation of them across countries - the phenomenon that has been identified in the literature as contagion. Currently he studies properties of international pricing practices, try to produce alternative measures of inflation, and is one of the two founding members of the Billion Prices Project, and a co-founder of PriceStats.  

 
12:00– 12:45

WFE Session - Managing Outages

Exchange computing technology has been around for some 30 years, and has always been architected to be resilient. In spite of this, most exchanges have experienced “glitches” which cause a great deal of reputational harm. Paul Pickup, a consultant in central markets technology, has often been engaged as an independent investigator to find out what went wrong after a system outage. The causes are not straightforward, however there are simple steps which can be performed to minimize the likelihood of an outage occurring.

12:45 – 13:30
Lunch
13:30 – 14:15

MIT Session – From START to Watson and Beyond

Boris Katz, Principal Research Scientist and Director of InfoLab
 
Boris Katz is a Principal Research Scientist and Head of the InfoLab Group at MIT's Computer Science and Artificial Intelligence Laboratory. His research interests include natural language understanding and generation, intelligent multimedia information access, knowledge representation, human computer interaction, and event recognition. He has authored more than 70 publications and 2 U.S. Patents.
 
Boris Katz is the creator of the START information access system and the inventor of a patented method of natural language annotations, which facilitate access to multimedia information in response to questions expressed in everyday language. In 1993, START became the first question-answering system on the Web, and since then answered millions of questions from Web users all over the world.
 
Boris Katz is a member of the Open Advancement of Question Answering consortium where he contributed several technical ideas incorporated into IBM's Watson system, which recently defeated the all-time human champions on the quiz show Jeopardy!
 
14:15 – 15:00

MIT Session - Innovation and Transparency in an Era of Next Generation Regulation and Oversight

Michael Schrage, Research Fellow

Michael Schrage is a research fellow at the MIT Sloan School's Center for Digital Business and visiting scholar at London's Imperial College. He researches, writes and advises on the behavioral economics of innovation. His work focuses on the role of models, prototypes and experiments as collaborative media for managing innovation risk. He's contributed on these themes for the Harvard Business Review, the Sloan Management Review, strategy+business, the Financial Times, Technology Review, IEEE Software, CIO magazine and other publications.

15:15 – 15:45
Coffee break
15:45– 16:30

MIT Session - Consuming XBRL financial information

Dr. Graham Rong, Chair, MIT Sloan CIO Symposium

 
 

 

 
Wednesday 23 November

 

9:00 – 10:00
WFE Session - Speed and orderly market
As some exchanges have developed a dedicated infrastructure to minimize latency, how this infrastructure fits with other systems? Can these other systems cope with the speed of exchanges?
More generally how HFT has affected the whole chain of systems? How are users adapting and what is the impact of some of the algos developed by some members on exchanges systems? What are the main demands from members today in this new trading environment?
Proposed topic and questions the presentation seeks to answer.
  • Steve Wunsch, Market Structure Consultant,Wunsch Auction Associates, LLC
  • Tony Weeresinghe, Head of Global Development, LSE Group
  • Miroslav Budimir, Deutsche Börse AG
  • Marc Rosenthal, Managing Director, Morgan Stanley
10:00 – 10:30
Coffee break
10:30– 11:15

WFE Session - Regulation and technology

The emergence of new forms of trading (algo trading, HFT, DMA…) has been made possible by technology. Do those new forms of trading and their new tools (colocation, sponsored or direct access…) require a new regulatory framework?
 
  • Laurent Grillet-Aubert, Senior Economist, Autorité des Marchés Financiers
  • Kyle Morse, Vice President, Arca Equities Surveillance, FINRA
 
 
11:15 – 12:00

WFE Session – The strategic importance of IT within exchanges

Technology has always been an essential strategic issue for exchanges (from ticker plant to the rise of screen-based trading and the development of HFT today). As IT has become a key component of exchange competitiveness, how has the CIO function evolved within exchanges’ internal organization and what are the new challenges for CIOs?
 
After an amazing growth of volumes in the last decade, exchanges face a much more uncertain outlook: stagnating volumes, low activity on primary markets, commoditization of equities trading and fierce competition in certain jurisdictions leading to low or no margins on business lines… What are the implications for exchanges strategy and their IT in particular? What are the prospects for new activities (OTC derivatives for instance) to develop new business lines and revenues?
 
12:00
End of Workshop