Information Technology in the Major International Financial Markets
45 Pages Posted: 15 Oct 2008
Date Written: April 1993
Financial markets perform a seemingly simple function: facilitating the transferof securities into cash, or cash into securities. Closer inspection of the activitiesand the information intensity of a trading floor or a dealing room reveals greatcomplexity. Information technology (IT) plays a crucial role in supporting makeractivities, and no trader today could operate without real-time data services, andcomputer-based analytical tools. Market information - about prices, interestrates, transactions, investor supply and demand, and company and economic news- is at the heart of any trading operation. Consequently, the major internationalmarkets from Tokyo to Zurich are making increased use of information technology.While IT is capable of making physical marketplaces and trading floorsobsolete, no consensus is emerging on the design of an integrated global financialmarket, and many technological and regulatory issues remain unsolved. Multiple,fragmented markets may be a consequence of the lack of coordination. Thischapter highlights the technologies that are revolutionizing international financialmarkets. The future direction of financial markets will be charted by automationand systems, and IT'S influence on banks, securities firms, and the marketsthemselves will continue to be a subject of debate and controversy.
Suggested Citation: Suggested Citation