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USE CASE

Product Recommendations for Fixed Income Instruments

 

According to The Securities Industry and Financial Markets Association (SIFMA), as of 2017, the U.S. bond market’s average daily trading volume has reached $815Bn. This is a large, global market with a deluge of bonds that could be integrated into fixed income portfolio strategies, but the evaluation process can be largely unautomated and may not be integrated into the trade execution workflow. However, despite this increased volume of electronic fixed income data, it is still difficult for portfolio managers to filter through the data available to make the best use of the electrification and make the most strategic fixed income product recommendations.

Synechron’s Cognitive Machine Learning Accelerator focused on Product Recommendations for Fixed Income draws on historical bond trading data to uncover patterns and then recommend bonds that have similar attributes preferred by a particular trader. The engine pulls in, catalogues and analyzes historical Trade Reporting Compliance Engine (TRACE) data and can expand to include other data sets like The Markets in Financial Instruments Directive II (MiFID II) post-trade best execution data to enhance global, real-time portfolio management and trade decisioning.

Intelligent portfolio management for fixed income products:

  • Content-boosted, collaborative filtering A hybrid Machine Learning (ML) approach that draws on content-based filtering techniques and collaborative filtering to analyze both the attributes of the bond and data on what other users have recently bought to offer highly targeted, strategic recommendations.
  • Fixed income product transparency Increased transparency into historical bond trading data and a greater awareness of new fixed income strategies, bonds, and market trends.
  • Portfolio strategies The ability to make faster and more targeted product recommendations to the trader.
  • Sales enablement Faster time to market for the sales person interacting with the trader.
  • Fixed income workflow optimization An increasingly digital workflow between the portfolio manager and the trader with the opportunity to connect to electronic fixed income trading systems; for example, Order Management Systems (OMSs) and Execution Management Systems (EMSs).

To learn more about our Artificial Intelligence solutions for Cognitive Machine Learning and the work we’re doing email us at finlabs@synechron.com

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