The topic of automated short-term trading is making waves the energy industry. In response to the keen interest, the consulting firm KPMG has now surveyed energy companies, asking what requirements they have of software solutions for automated trading.
Out of 144 companies asked, 42 took part in the survey. The results, as expected, are very revealing:
Reading responses and the option of notifications were considered the most important IT requirements by the participants. Additionally, support for internal deals, connecting to external systems and creating schedules were also viewed as important. By far the least significant requirement was the availability of a smartphone app.
In terms of trading, the companies placed particular importance on supporting the ability to conclude internal trades within control areas, a graphical display of the order book and multi-client capability of the software solution. On the other hand, the topic of cross-border internal trades was met with less interest.
For risk management, an emergency stop function, a price and quantity limit management capability, the ability to limit the size of individual orders and the ability to limit the maximum position were favoured. The lowest priority was given to the tracking of the order transaction ratio (OTR).
A clear trend can be made out regarding the topic of algorithms. Freely parametrisable algorithms were considered the most important criterion. Some way behind this was the ability to back test in-house algorithms. In contrast, the least interest was for the support of block orders.
We are pleased that our solution, the autoTRADER, perfectly covers the requirements of the surveyed companies. This is particularly true regarding the possibility to develop and freely parameterize trading algorithms. In addition the autoTRADER offers a perfect solution for the combination of an automated short term trading with a schedule management.
You can find a detailed analysis of the survey here as a PDF:
KPMG is a professional service company and one of the Big Four auditors. It is one of the largest accounting and consulting firms in the world with around 189,000 employees in 152 countries and has over 100 years’ experience in the industry.
KPMG provides broad energy industry knowledge, combined with experience in core areas including accounting, treasury and tax.