Financial technology provider youDevise Limited launches TIMConnect, a lower latency, resilient XML push of stock trading ideas from institutional brokers, through the Trade Idea Monitor (the TIM), into high volume, quantitative trade idea systems.
TIMConnect replaces slower and less secure delivery mechanisms such as email and systematic polling, which can take a few minutes to deliver an idea. TIMConnect tracks the delivery of an idea and will take corrective action immediately, if necessary to ensure the consistent transfer of content.
While speed is important – as our internal studies show that the faster one acts on an idea, the larger the gain – reliability is equally critical, says Colin Berthoud, founding partner of youDevise and co-developer of the TIM. Our clients cannot afford to miss an action whether thats the open or close of an idea or an update. With TIMConnect, our clients will be able to improve their already significant returns, as 75% of our idea authors outperform the market.
TIMConnect was developed in response to the growing number of buy side firms that use trade ideas as a determining factor in quantitative trading models. Such investors pay significant sums to institutional brokerage firms to access their trade ideas in near real time, analyze the ideas using proprietary algorithms, and then issue automated buy and sell orders.
Trade ideas are client specific long/short recommendations that also indicate how much money should be committed to the trade. Systematic use of brokers trade ideas was pioneered in the early 2000s by Marshall Wace LLP of London, one of Europes foremost hedge fund managers.
youDevise also released TIM statistics for October 2009:
Total buy and sell side firms using the service, at 555, are up 2% month over month and 35% year over year. The TIM has added 143 net new firms over the last twelve months.
On a sequential monthly basis, total new ideas and closed actions increased 36%, to 52,576, with new open ideas increasing 32%, to 26,793, and new close ideas increasing 40%, to 25,783. Growth reflects existing brokers generating more ideas as a greater number of their buy side clients have been joining the TIM platform.
The percentage of new long ideas was 67.7%, a new high for 2009 and a new high for the last 22 months. The closed/new idea ratio increased to 49.0%, from 47.5% in September, the second lowest in the last twelve months. The closed/new idea ratio indicates the level of profit-taking.
Total open and closed ideas at the end of October increased 5% month over month and 89% year over year, to 739,016. To date 2009, the total has grown at a 5% sequential monthly basis. Based on this rate, the TIM should break the one million idea mark in the second quarter of May 2010.
D.C.