We tend to believe that the issues that affect the day-to-day lives of traders and others who work in financial services are unique to our own time and place. In a world of skyscrapers and FinTechs…
We tend to believe that the issues that affect the day-to-day lives of traders and others who work in financial services are unique to our own time and place. In a world of skyscrapers and FinTechs, it can seem like we are at a singular moment in financial history. But in reality, some issues like remedying information overload, have been discussed for almost as long as markets and those that seek to profit from them have existed. A great example is Geoffrey Chaucer, a merchant in the City of London in the 14th century, who occasionally wrote a poem or two, when he wasn’t trading in commodities. His contemporaries feared for his well-being, because alongside his enormous library of around 60 books, he also had dozens of reports flowing to him daily. He received details on the ups and downs of trading in wine, in silk, and in gold, from all of the great exchanges of the time: Antwerp, Florence, Venice, and Constantinople. His friends, we know from surviving documents, believed all that information must be downright bad for his health. No one could process it and be able to make rational decisions.
Combine that concern with the stories about the merchants in The Canterbury Tales, and you have a picture of a very modern trader. From gossiping about colleagues who have broken regulations surrounding Forex trading, to a disdainful general public that see the great riches that these traders have generated as having being procured at the expense of ordinary hard-working Londoners, it seems that there are perennial issues faced by traders regardless of where and when they were trading.
Indeed, one wonders what those 14th century traders would have made of the information overload facing traders in the 21st century. It’s the same problem that they faced, but on a scale that they never could have imagined. There is a thriving industry trying to provide solutions to the problem of information overload in the financial markets, but it tries to deal with this perennial problem, with outdated solutions.
Existing solutions treat the documents as a whole, either by using textual search techniques to look for variations of an exact word or phrase, or coarsely tagging a document which enables them to be filtered by their semantic value. The fundamentals of both of these techniques: marking up a document, or scanning through it, would not have been unfamiliar to a 14th century reader: it is the laborious task of going through each piece of research one at a time with the digital equivalent of a highlighter in your hand.
Today, results are typically presented as a list of documents to be viewed individually. But, to be able to access the maximum amount of latent value in financial market analysis, modern traders need to be able to identify specific paragraphs that may be buried deep within multiple discrete documents. Allowing them to be found in one step and presented in context as a first-class result enhances the pre-trade decision-making process. 700 years on, that’s the value that financial research SaaS companies are capable of adding, after years of underinvestment in this sector of financial research.