Greenwich Associates: Data scientists to become new quants

Analyst firm Greenwich Associates has predicted that data scientists are the next evolutionary step from those programmers who started finding their way onto the trading desk around the turn of the century.

“Over the course of the following decade, those programmers morphed into quants who spent less time on cool user interfaces and more time on trading algorithms and market-prediction models,” Greenwich noted. “It is becoming clear that the early part of the 2020s will see data scientists take over those seats on the desk.”

Commenting on the report, Michael Boguslavsky, head of Artificial Intelligence at Tradeteq, said, “Over the next decade, data scientists will become integral to the future of banking and finance. Many of these institutions have decades of data which haven’t historically been utilised effectively. Banking regulations have some part to play in making bank data sets increasingly available. With this, data scientists will become more integrated into the actual business practice of banks.”

Matthew Hodgson, CEO and Founder of Mosaic Smart Data, said, “As we enter a new decade, the demand for data scientists across the market is at the highest it has ever been. Institutions should, therefore, be looking for ways to utilise the data scientists they employ in the most effective way possible.”

He argues that the biggest and most forward-looking firms across the market are utilising platforms that automate low-level tasks and by doing so are freeing up their in-house quants and data scientists to focus their time and expertise on driving insights from the data and putting them to practical and value additive use in the institution’s trading operations.

“Currently, around 80% of a data scientist’s time is spent identifying, remediating, aggregating, cleansing and normalising data to transform it into a suitable format for analysis,” said Hodgson. “These highly skilled individuals are spending time on tasks that an automated platform is more than capable of handling and in a fraction of the time.”

Greenwich noted that data scientists are not actually kicking out quants and programmers; ‘data scientist’ in the firm’s parlance is the new name for someone expert in programming, quantitative analysis and data. The firm said it could be argued that most if not all of the market’s evolution over the past decade has come about because of access to data and the ability to put it to work. As a result it should come as no surprise that those expert in doing just that are taking over.

Boguslavsky added “If data scientists are brought into business processes from the outset, they will be able to transform the way the entire business is run from a data science perspective. Intelligence will go a long way to accompany this change in process, as businesses explore new ways of working that bring data scientists – and technology more broadly – into every aspect of their operations.”

©The Science of Investment 2020

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