On July 26 2013 Wall Street & Technology published an article by RACS CEO Martin Jermakyan titled Decision-Making Automation: The Next Financial Services Innovation . In this article Martin argues that streamlining, automation, optimization and commoditization of trading decision making and management processes for the trading, portfolio and asset management lifecycles will be the next driver and will open the floodgates of innovation in trading technologies. He further asserts that decision making automation will define how software, platform and infrastructure will need to be innovated in the coming future. This next level of innovation, along with systematization and optimization of the trading industry, he continues, will require further advancement of trading analytics, elimination of some old controversies, descriptive metrics for the measurement of the expected behavior of portfolios, supposedly resulting from the submission of trade orders. He finalizes his article stating that quantification and management of the diminished liquidity and its factoring into decision making analytics will be one of the fundamental components of the next generation trading systems. Interestingly, the publication of this article by Wall Street & Technology coincides with the July 24, 2013 release of the conclusions of the allegedly most detailed and comprehensive survey titled “ Move over Chicago, London's colo appeal is on the rise ” of more than 600 global financial market participants conducted by Automated Trader , which finds that “Colocation services have traditionally been associated with achieving low latency execution, but the latest AT survey found the emphasis is now firmly placed on swift collection and digestion of data within data centres to get information on what to trade and when. Having a lower "decision latency" than the competition is now a key priority. The rapid rate of automation has forced many market participants to leverage their competitive advantages in more asset classes, trading venues and regions than ever before.” As if from the playbook of RACS the survey further concluded that “Increased competition has also pushed traders to seek out an ever-expanding range of data sources and services, resulting in a shift of emphasis from execution latency to decision latency. Decision latency is the deployment of smart algorithms that speed up the decision making process on what to trade and when, while incorporating pre-trade and real-time portfolio management issues.” Finally, the survey states that “its results clearly show that while maintaining relative latency at competitive levels continues to be a focus for the majority of trading firms, there is a shift in emphasis from outright execution latency, as firms look further back into the trade lifecycle to hold on to their position amongst latency leaders." It is also noteworthy that on 18 July 2013 IBM and UniCredit announced “a multi-billion dollar, 10-year agreement to transform the IT infrastructure that supports all of UniCredit ’s commercial and private banking activities in Europe. As a result of this transformation, UniCredit will gain dramatic efficiency and flexibility with the introduction of new service models and a cloud-based infrastructure for its data centers. As a result, UniCredit clients would be able to access new and innovative services that meet the growing demand for sophisticated financial services in Europe. ” This modus operandi agreed upon by IBM and UniCredit was one of the cornerstones of RACS business model and was been distributed in the past by her as depicted in the below diagram and borrowed from its presentation materials: Source: RACS materials � Moreover, on 23 July 2013 TABB Group released Andy Nybo’s US Options Trading 2013: Looking for the Edge research paper which, in particular, states: “It is getting a lot harder to find a profitable edge in options markets. Not only is volatility range-bound, but traders are challenged to find liquidity in less actively traded options. Brokers continue to rein in capital as part of efforts to rationalize the level of service they provide to clients, and the issue will only get worse as the regulatory focus on bank balance sheets continues to build. Meanwhile, in options where there is liquidity, competition has whittled away the easy opportunities. … Range-bound volatility is creating challenging market conditions for options traders and forcing them to be more aggressive in their search for returns. … Even as volatility has waned and equity markets have seen relatively little growth, options have remained as an important tool the buy side uses in strategies to generate returns, to earn premium income and to manage exposure. Volumes may have declined in recent years, but the buy side has adopted strategies and trading processes to manage the new market environment. The buy side’s willingness to adapt to shifting market conditions bodes well for future growth as options become an integral tool to use in any market condition. ” In addition to the transformations that continue to take place in global financial markets, RACS views all of the above to serve as vindication and support for its vision and business model. ### For further detail contact RACS, LLC at mjermakyan@ravcap.com , +7(978)749-9927 or +1(212) 925-9362.
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