OTAS Tech Enhances Portfolio Management Functionality, Looks to EMS Space & Sell Side for 2015

Through OTAS' suite of solutions ─ the OTAS Core platform provides decision support, OTAS TradeShaper delivers pre-trade and "in-trade" analytics, while OTAS Base is an application programming interface (API) and visualization tookit, which was launched in the third quarter of 2014 ─ the vendor has established itself as a decision-support tool provider that centers on real-time analytics and alerts.

OTAS Views and Natural-Language Rollouts
In early December, OTAS will officially release OTAS Views, which is a new feature that will allow traders and portfolio managers to create user-customizable views and analytics.

"For the first time, a portfolio manager can take the platform and create a view that is only focused on a couple of valuation metrics," Doris says.

Users will be able to select any combination from over 200 unique factors that can then be used to filter, rank and score a stock. They will also be able to create an unlimited range of custom views.

For example, traders can be alerted when the options market is positive on a name, the valuation is considered cheap from an historical viewpoint, and there are no warning signs from short interest or the debt market. All these factors are embedded by the trader into the platform based on their own fundamental approach for monitoring and managing their portfolio.

OTAS Views will also include a new natural-language generation (NLG) engine that will provide full report-writing capabilities that will look as though a human wrote them, says Doris. Users can define the tone and verbosity of the reports, create their own watch-list of names, and by pressing a button create a report that looks similar to what a human research analyst would write, but customized to the names in their portfolio and highlighting the things that are important to them, Doris adds.

"The key technology that we have in the platform that facilitates that does all the heavy lifting and hard work to create the analytics that can identify what's important just by looking at the data and extracting that information for traders and portfolio managers," he says.

The NLG engine is expected to be completed by the end of this year and will be rolled out in the first quarter of 2015.

EMS Partnership
OTAS is also looking to serve as a partner for EMS providers that are looking to compete with Bloomberg.

Doris says traders want a seamless experience in which they're getting the right information at the right time and in the right context. They also want to be alerted to what they should be looking at.

"The major EMS providers would all say that they're in competition with Bloomberg for real estate, so the more functionality and content they can put into their platform, the fewer times the trader is going to key out to Bloomberg and the stickier their product becomes," he says.

Doris says a partnership makes sense because the EMS space has become commoditized and there hasn't been enough investment in enhancing a trader's ability to make good decisions, and understand what's happening in the market and why it's moved. Doris says he hopes OTAS' analytics will serve as a differentiator.

"It's a commoditized space because FIX is standardized. There isn't a whole lot of room for creativity in terms of how you manage your order workflow," Doris says. "There isn't going to be [Apple's famous designer] Jony Ive creating the iPod of EMSs anytime soon. All of those guys are competing for marketshare and for desktop space. They need to differentiate their product because, frankly, EMSs aren't largely differentiated in any meaningful way; their sales pitches amount to having a nice look and feel." 

Move Into the Sell Side 
Doris says OTAS' roadmap moving forward will focus on expanding its footprint after first catering to large asset managers, including Franklin Templeton, and then hedge funds. Next, he says, are large banks.

"The story for us in 2015 will be getting our content into as many distribution channels as we possibly can," he says.

Doris says OTAS is in the "early stages" of speaking to the sell side, and has gone through product evaluations with six tier-one investment banks. The plan is to break into the sell side sometime in the first quarter of 2015.

The move makes sense, Doris says, because sales and execution traders are hearing about OTAS from their largest buy-side clients, and the vendor's analytics solutions have crossover for the sell side.

"The product evaluation process has actually been educational for us," Doris says. "For sales traders, a lot of the market observation analytics that we provide are useful for the order makers, the people who are originating content and ideas, and getting on the phone with clients to create order flow. For their execution traders, the real-time analytics, market microstructure, and the analytics as to how to best execute that order in the face of fragmented liquidity and volatility" are of greatest interest.