Finally, a decent use for big data: Weeding out crooked City traders Financial institutions in London could use "big data" technology to pinpoint malpractice by City traders in future, a panel advising the Bank of England has said. The Market Practitioner Panel (MPP) said existing methods of monitoring for illegal trading practices, such as "key word surveillance", were flawed and that …
Putting aside for a moment the fact that Big Data is just the buzz word / consulting revenue earner du jour, I do wonder how "predictive coding" (new one on me) is distinct from the big basket of analytic and data science techniques that have always hidden under the auspices of those horrid words "Big Data".
Since traders in particular are monitored up the wazoo already I can almost guarantee that every major bank has been mining that data for a good few years now. Whether its any better than state surveillance at spotting bad behaviour is another question entirely. :)
Its also worth noting that some of quantitative techniques that underlie the Big Data hypegasm have been being used on Market, Trading and Risk data and decisions for at least a decade - with decidedly mixed results.
100% agree. It does seem that a group of people who don't really understand what "Big Data" is have decided it's the solution because it's the latest buzz word and that somehow it'll magically pick out all the dodgy dealing.
It's the sort of idea Jen would have come up with. Or, perhaps my father-in-law:
"I've enabled AHCI", he says.
So I ask "Why?".
He replies "To help the IO subsystem".
I then have to ask "Do you know what an IO subsystem is?".
Silence...................
"...with decidedly mixed results."
Too much chaos for data to be meaningful, but they'll keep trying to sell it as a predictability, of course. At least some things are predictable.
Just... compare who are "friends" and who makes money most of the time. How many or how long can winning streaks be? Or... is beyond the threshold of "WTF were you thinking? If you keep that up, everyone will find out the game is rigged". That information doesn't seem to need to be so big to extract that conclusion.
I'll take it one step further... farther... father?
"However, firms do need to exercise some caution and accept that there will be some behaviours and trades that appear suspicious on the face of it but which are in fact perfectly legitimate."
Let's see.. it is, in fact, perfectly legitimate to take money+infomation=more money, so, yes please tell us you are excercising caution when you are trying to distinguish between profitability and profit. We'll believe you.
"Technology can be used to flag malpractice but there should be follow up procedures to ensure firms understand the context of traders' actions before taking any disciplinary action."
Let's see... the context of traders actions is to make money... mostly for themselves, but *sometimes through and for a 3rd, 4th, 5th... party, so please explain to us what/who these "follow-up procedures are for. We'll believe you.
Help from GCHQ to snoop personal email, bug their cell phones for location and call history and/or content information? You can figure out insider trading is happening if a certain trader is always on the right side of trades in a given company, and his phone's GPS comes within 2 meters of the GPS of the phone of that company's CFO. Because you can, doesn't mean you should.
The article is titled "Weeding out crooked City traders". Assuming crooked traders will follow the rules is probably not very smart if you actually want to catch them. A bank can make a rule that people can't wear masks inside the bank, but bank robbers might choose not to follow it.
"With big data analytics, there is the temptation to use the technology to build up a precise profile of each individual traders' behaviour and practices. However, intrusions into individual privacy must be proportionate and necessary to comply with data protection laws."
Hold on. This is about what the traders are doing on the company's time, with the company's equipment, with the company/customer's money and on the company's salary. Why should there be an expectation of privacy? Surely their management is entitled to ask for a precise profile of behaviour and practices any time they like, or do they work on very different terms to the rest of us, and if so why?
by and large you are right - but there are some countries where legislation on an individuals right to privacy trumps those concerns. I dont know but I suspect that German is one of those countries. However in the UK you're pretty much under the panopticon (as you should be)
"All traders phones are monitored its a dismissal offence to use a non-company phone for trading business."
Even before GPS became public, a cellphone signal and the camera locked onto each trader were bound. Any attempt at buying a prepaid cell from the local five-n-dime was considered uncivilized... <tinfoil>
The mere thought of the day-trader trading in after hours sessions with his own cash means that person is by default dishonest... not just moonlighting?
The Register 
Biting the hand that feeds IT
Copyright. All rights reserved © 1998–2024
