Nasdaq Leverages AI to Boost Efficiency and Transform Capital Markets
Nasdaq is embracing artificial intelligence (AI) to streamline its operations and provide innovative solutions for clients in the financial sector. Tony Sio, Nasdaq’s Head of Regulatory Strategy and Innovation, discussed the exchange’s AI approach at the AWS Financial Services Symposium in New York City on June 6. Sio highlighted the importance of innovation, collaboration, and speed when deploying AI, emphasizing that AI should not be seen as just an experiment but a practical solution for real-world problems.
Key Takeaways
- Nasdaq is using AI to improve its own operations as an exchange operator and is developing AI products for clients. The company is focusing on creating efficiencies and solving complex challenges for banks, asset managers, and other exchanges.
- Dynamic M-ELO, an AI-powered order type, helps market participants find like-minded traders and optimize execution quality by dynamically adjusting order sitting times based on market conditions.
- AI is aiding investment firms in ESG investing by streamlining the process of identifying companies aligned with sustainable investment criteria.
- AI is enhancing trade surveillance by identifying anomalies and suspicious trading activities, such as pump-and-dump schemes and spoofing.
- Nasdaq is prioritizing the development of AI products that are both innovative and regulatory-friendly. The company believes in involving all key stakeholders, including technology and industry experts, from the outset to ensure the AI solutions address market issues effectively.
Nasdaq has partnered with Amazon Web Services (AWS) since 2021 to move its trading infrastructure to the cloud. Scott Mullins, General Manager of Worldwide Financial Services at AWS, emphasized the strategic alignment between Nasdaq and AWS in harnessing AI to solve real-world financial problems.
“Tony and the team at Nasdaq understand that a successful AI strategy uses the right data and technology to solve the right problem—with security and ease of use,” Mullins said. “Nasdaq innovates on behalf of the global capital markets by combining its industry-leading expertise with AWS cloud and AI technologies to solve real-world problems for its clients.”
Sio’s remarks highlight the growing importance of AI within the financial services sector. As data volumes increase and the need for speed and efficiency intensifies, AI is no longer just a tool for experimentation but a critical driver of innovation. Nasdaq’s commitment to leveraging AI to improve its operations and develop innovative solutions for its clients underscores the transformative potential of this technology across the capital markets landscape.
