A new report from Aite Group, LLC examines IT spending by capital markets firms, and provides forward-looking estimates and insight into IT priorities and staffing.
While Aite Group expects 2008 IT budgets at capital markets firms to continue to grow, the rate of growth should be slower than that of 2007. This year’s budgets will be slightly less than 10% higher than last year’s, on average.
Based on the increase, Aite Group anticipates US capital markets companies to spend roughly $3.7 billion more on IT initiatives in 2008 than in 2007. As was the case in 2007, operational efficiency remains the top priority for the year among technology executives allocating budgets for IT initiatives.
Risk management, systems integration, back-office settlement and front-office workstations will be the top systems priorities, while Enterprise Data Management projects will lead core technology implementations.
“As many anticipated, revenue forecasts for 2008 are not particularly optimistic. However, the pace of market change may not allow capital markets firms to slow their technology spending. Like never before, technology is a differentiator in high-speed trading. Meanwhile, investment advisors need to spend on systems that can help them customize strategies for an increasingly nervous client base,” says Adam Honor, senior analyst with Aite Group and author of this report.