Hayley McDowell: How has the execution management system (EMS) / order management system (OMS) market evolved since FlexTrade set up in London?
Vikas Kedia: When we started out in London in 2002 the OMS had always been a mandatory requirement for the buy-side, whereas the EMS was a more advanced feature. In some cases the OMS provided enough for those firms to carry out the execution, but in the last 15 years the EMS has grown to a point where it has now become mandatory. We feel as though the OMS has not been able to keep up with the advances and the requirements that sophisticated execution workflow needs. This includes everything from connectivity to the fact they are often database driven which can affect speed. OMS latency is currently in seconds, whereas EMS latency was in milliseconds but it’s now in microseconds. The OMS simply has not been able to adapt to the increased level of speed that an EMS is expected to carry out now. We have a client currently testing our EMS for 10 million fills in a single day, and this is something an OMS simply can’t keep up with. The OMS is still more about keeping track of accounts or positions and that’s a very different functionality.
Having an EMS on the desk is no longer considered a showstopper or massive investment for buy-side firms. In FlexTrade’s case, it has also become a software-as-a-service model, meaning there is very little the client has to do now in order to set up the EMS. The front-end is adaptable in terms of design and the software can look exactly like the systems buy-side firms already have in place. It allows asset managers to set up the system and immediately carry on with their business without having to readjust the way they interact with their EMS.