Big data talent struggle for banks and hedge funds

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Big data is going to provide a big headache for investment banks and hedge funds, who are struggling to find enough talent to build the tools they need.

Financial services firms are turning to technology to help them capture, analyse and visualise the vast amounts of digital data being produced each day – so-called Big Data. And they’re about to start spending on technology; new research from tech consultants Celent in the US predicts that capital markets firms’ big data budgets will hit $1.2bn this year and $2.4bn by 2015.

Only now, however, are financial services firms hiring. Because of a skills shortage, hedge funds and investment banks will “struggle to hire and attract the experienced Big Data staff they need,” said Celent in its report. Hedge funds in particular will need to “aggressively invest in advanced analytics and experienced staff."

Across all industries, hiring related to Big Data promises to be massive. Tech consultant Gartner suggests that 4.4 million roles will be created globally by 2015.

For data analytics, this essentially means that quants are about to become hot stuff in hedge funds. “Quants are attracted to Big Data because it gives them access to larger and more diverse data sets,” said the Celent research.

Robert Grant, chief operating officer in IT at finance recruiters Cititec in London, says that hedge funds, and to a lesser extent banks, are “always looking for the latest experts from academia,” namely highly quantitative PhDs.

“The roles we’re seeing are for quantitative researchers, but they’re also known as data scientists or machine learning analysts,” he said.

Pay for such roles isn't large. Grant said annual salaries range from £50-80k, rising to a £95k base for more experienced candidates.

On the trading floors of investment banks, meanwhile, firms are experimenting with “sentiment analysis” tools, says Celent, which look for press coverage and social media content that could negatively affect a particular firm or sector.

“The surge in negative sentiment shows the power of traditional and social media and how quickly they can affect revenues and earnings,” said the research.

Banks are also hiring people to build data visualisation tools – after all, most people viewing the information will be non-technical, so it’s essential that key trends can be easily digested.

“Banks are hiring people to create data visualisation tools who have a background in developing UX/UI solutions in the financial sector, but are also looking to those with a front-end design background from wider industry” said Paul Bennie, director of IT in Finance headhunters Bennie MacLean in London.

If you’re wondering why big data is such a big deal, take a look at this chart from Celent’s research. External market data, namely information from external sources that could impact trading, has increased by five times over three years.