Waters Rankings 2008

In our sixth annual Waters Rankings, the readers of Waters choose the industry's best solutions and services. By the Editors

Excellence matters. Despite a rash of abysmal business headlines about layoffs, tight budgets and hasty mergers, one truth remains. Investment firms need top-of-the-line, best-of-breed IT solutions to seal the deal. Reaching alpha is the goal as is accomplishing the task in the fastest, most efficient way that is well within the guidelines of the latest of regulatory compliance measures. Nothing less will do. In short, middling technology need not apply-you will be shown the door.

It is our pleasure to welcome you to the sixth annual Waters Rankings. Each year, we ask our readers inside leading global investment firms, exchanges and hedge funds to vote for the best and brightest financial solutions and services that help them get the job done. This year, Waters saw an enthusiastic and game-changing response from its pool of voters. Vendors and nominees, who were ineligible to vote, blogged about the Waters Rankings and urged their investment firm clients to weigh in on which solutions deserved the gold star. Waters registered more than 600 voters and after scrubbing out votes from IT vendors and PR firms-naughty, naughty-we created a rock-solid list of finalists. This was a year of surprises. In some categories we had new winners while in other categories we saw the return of old favorites. In the end, the qualified readers of Waters spoke and proved one telling point that we knew all along: Technologists know what they want and need to keep their investment firms ahead of the pack.

Congratulations to the winners of the 2008 Waters Rankings.

Winner's Circle

Best Brokerage: Goldman Sachs

Best Crossing Network: Liquidnet

Best Sell-Side Clearing: JPMorgan

Best Investment Services: JPMorgan

Best Sell-Side OMS: Fidessa

Best Buy-Side OMS: Linedata Services

Best Portfolio Management System: SunGard

Best Execution Management System: ITG

Best Enterprise Data Management Solution: Sybase

Best Streaming Data Management Solution: StreamBase Systems

Best Exchange Data Feed: NYSE Euronext

Best AML Compliance: Mantas

Best Risk Management: Thomson Reuters

Best Trading Turret: IPC

Best Financial Network: BT Radianz

Best Networking Infrastructure Firm: Cisco Systems

Best Business Process Management: IBM

Best Complex Event Processing Solution: Oracle

Best Server Virtualization: EMC/VMware

Best Grid Infrastructure Solution: A tie-HP and IBM

Best Outsourcing Partner: Infosys

Best Corporate Actions Solution: Fidelity ActionsXchange

Best Brokerage

Goldman Stays Golden

After a brutal year of relentless business news headlines, one firm withstood the ravages of the mortgage meltdownand continues to shine as a brokerage. For the third year in a row, Goldman Sachs has won Best Brokerage.

The venerable investment firm maintains its altitude, thanks to its multi-product electronic trading platform RediPlus. This platform offering provides buy-side clients access to a swath of asset classes and markets around the globe. The system can be adapted to suit a variety of trading styles, and provides a complete front-to-back office technology solution that enables clients to trade equities, options, futures and foreign exchange. Further, RediPlus boasts pre-trade analytics, value-added execution services, algorithmic trading, portfolio trading solutions and post-trade analytics.

The firm's Prime Brokerage platform offers execution services across the investment cycle to minimize trading costs. Clients can access Goldman Sachs' multi-product algorithms, pre- and post-trade analytics and clearing and Prime Brokerage platform, which boasts robust risk analytics and performance measurement tools, real-time reporting and portfolio analytics, a customizable desktop display, synthetic products integration across the platform and more. Goldman Sachs allows clients to pursue non-displayed liquidity through its global Sigma liquidity strategy, which includes the Sigma X crossing network in the US.

Goldman Sachs claims to deliver a higher level of service to its Prime Brokerage clients. Judging by its clear lead in this year's vote, this appears to be more than an empty boast. The brokerage offers a dedicated electronic trading coverage desk staffed with trainers and support and service staff. The firm also offers access to skilled Goldman Sachs execution traders, for "value-added execution expertise and market color" according to the firm's Web site.

This category contains two new entrants to the winner's circle: ABN Amro and ITG. Last year's second and third place winners-Morgan Stanley and Merrill Lynch-did not place quite so high in these tough economic times. Granted, Goldman Sachs Brokerage remains golden indeed.

Best Crossing Network

The Liquidnet Wave

Crossing networks remain a competitive category in today's ever-changing trading environment. In a sign that the market likes best what it knows well, Liquidnet has climbed into the top position this year, after being voted second to ITG Posit in last year's Waters Rankings.

Founded by Seth Merrin in 2000, Liquidnet has carved out its share in the market by offering a unique value proposition. Where most other dark pools and crossing networks rely on order flow from all sides of the market, Liquidnet's core offering is restricted to buy-side participation, which has made it particularly popular with institutional asset managers and hedge funds. The Liquidnet application connects to a buy-side order management system and automatically sweeps the blotter, immediately alerting the trader if a match is found on the system of another Liquidnet member. As well as operating in North America, where it was founded, Liquidnet has been active in Europe for over five years and was rolled out to Asia in late 2007. Its global reach now extends to 29 markets, and earlier this year it was ranked as top broker for New York Stock Exchange and Nasdaq stocks and third largest agency broker on the London Stock Exchange.

In second place, Goldman Sachs Sigma X labels itself as the largest pool of non-displayed liquidity in the US, comprising a client-to-client crossing network and a number of external liquidity providers. The network allows users to take liquidity from non-displayed sources and benefit from the aggregated source of liquidity that flows through the firm's infrastructure. Sigma X is available in the US and European markets, and it includes liquidity-seeking algorithms, smart order routing and aggregation tools and analytics.

ITG Posit has slipped from its winning position in last year's Waters Rankings, but remains popular, with a trusted history going back 10 years. The Posit Suite now includes three crossing networks: Posit Match, Posit Now and Posit Alert. Posit Match offers eight scheduled matching cycles each day; Posit Now offers continuous crossing throughout the day and Posit Alert was rolled out earlier this year to automatically alert buy-side firms to the possibility of a match.

Best Sell-Side Clearing

JPMorgan Clearly Leads

In a close and surprising race, the winner for Best Sell-Side Clearing Provider didn't even place last year. JPMorgan won a tight margin victory with 14.4 percent of the vote, compared to Citi and Goldman Sachs, which were in a tight race for second and third with 11 percent and 9.3 percent of the vote, respectively. Goldman Sachs' third place showing is remarkable because last year it won the category with twice the votes of the second place winner, Bear Stearns. The troubled Bear didn't place in this year's race, for obvious reasons.

Just scan the closeness of the votes and anyone can realize that the race for sell-side clearing services is tight and the entire field of financial services clearly enjoys a choice of options. That said, we tip our hat to JPMorgan. After a bruising year of tough business headlines, Waters readers still trust the white shoe firm for what it can offer the buy side during the trade cycle.

According to the firm's claims, JPMorgan is the leading clearing bank for U.S. government securities, where it settles more than 110,000 trades daily and more than triple that volume at peak times on average.

JPMorgan relies on its Broker Dealer Automation System (BDAS), a robust and speedy trade settlement system that moves book-entry deliveries to the Federal Reserve Bank of New York within seconds. This automated trade clearing service handles trades with a high degree of accuracy, looks for exceptions such as partial trades and unmatched receives and other factors that can destroy a deal. The BDAS also delivers detailed end-of-day reports, intra-day queries and the ability to initiate funds transfers and book transfer payments.

For clients with a worldwide business, JPMorgan offers GlobeClear, which is the investment bank's international securities trading suite of products for global clearing, integrated financing and collateral management. This one-world platform delivers clearing for 22 exchanges and more than 60 over-the-counter markets including Federal Reserve and DTCC through a single entry point.

Best Investment Services

JPM at Their Service

It's a repeat two out of three times for Best Investment Services this year. Like last year, the first and third place winners are the same-JPMorgan and Bank of New York Mellon-with a new second place winner. HSBC, a truly global firm with a keen eye on the financial potential of Asia and the Middle East, scored second with 14.4 percent of the votes this year. More interesting, JPMorgan returns easily to the winner's circle but with a lower percentage of votes; this year the investment giant claims 27.9 percent compared to last year's showing of 33.4 percent. State Street, last year's second place winner misses the top three.

JPMorgan claims this title for the third year in a row, thanks to its JPMorgan Worldwide Securities Services (JPMWSS), its global service that claims more than $15 trillion in assets under custody. The service delivers cutting-edge custody, fund administration and accounting and assorted securities services to the largest and most demanding alternative asset managers, institutional investors and issuers of equities. Celebrating its third anniversary, it offers efficiency, risk mitigation and enhanced revenue in more than 90 markets.

This has been a solid year of growth for JPMorgan. In June, the Banking and Payments Authority of Timor-Leste, the government entity of East Timor, chose JPMorgan as the custodian and administrator for the Petroleum Fund's assets. This was a first for the Asian nation and its $2.9 billion fund with a current monthly inflow of $200 million. In June JPMorgan also launched its Derivatives Collateral Management (DCM) solution, a new automated reconciliation technology for global clients. It works with TriOptima's triResolve automated position reconciliation service for improved efficiency and risk management of trading records. If that were not enough, JPMorgan leased approximately 100,000 square feet of office space in South Boston and announced plans to hire more than 300 employees for its global funds services business over the next five years. It might be a tough economy but JPMorgan's investor services is gearing up for brighter times.

Best Sell-Side OMS

Fidessa First

Among sell-side order management systems, Fidessa remains in the lead, and sees its lead grow from 23.7 percent last year to 24.7 percent this year. This proves that in the tight and tough OMS landscape, solid solutions gain loyalty among traders.

With sophisticated order management, real-time position keeping, consolidated market access and basket support, Fidessa provides seamless, straight-through processing from order creation to trade confirmation as well as supplies comprehensive market data and global connectivity.

More than 50 new clients globally signed up for Fidessa's trading platform, bringing the client total to 172. Fidessa's multi-asset trading platform available in Europe saw more derivatives markets connected and six new sales of derivatives functionality across its client base.

Launched just over a year ago, Fidessa's Canadian Trading Platform (CTP) experienced significant growth, with five clients signing up for the fully hosted trading system. In Asia, Fidessa contracted to supply its trading platform to four Asian clients totaling over 100 users, including Cantor Fitzgerald (HK) CapitalMarkets Ltd. and Jefferies (Japan) Ltd., which have gone live.

Netting 19 percent of the vote is SunGard's Brass, which announced that Knight Link will provide Brass users with the option to interact with Knight's deep pool of off-exchange liquidity. Third is Lava Trading, a subsidiary of Citi, which says it is working with Traiana, a provider of post-execution STP for the FX market, to create a post-trade netting service for the FX market.

Best Buy-Side OMS

Front of the Line

The voting in this year's best buy-side order management systems (OMS) category shows that users still like an independent system. All three top providers are part of a shrinking race-none are owned by brokers and none are being merged with an execution management system.

Linedata Services' flagship product LongView Trading is a fully integrated front-office trade order management solution for global buy-side institutions that supports the business requirements and workflows of portfolio managers, traders and compliance officers. It offers advanced portfolio modeling, order generation, electronic trading and compliance functionality, and provides seamless integration to hundreds of trading destinations globally. If that were not enough, this is also LineData Services' debut in the top spot of this category.

LongView allows for trading with multiple currencies and asset types, and includes a customizable user interface. It features real-time architecture, allowing for seamless integration with third-party applications, and compliance functionality, which allows users to catch violations before they hit the trading desk. Client services include implementation, technical support, dedicated account management and consulting. An updated version of LongView Trading will go live in Q1 2009 and will feature enhanced visualization capabilities.

LongView can be fully deployed, or offered on an application service provider (ASP) basis. It uses .Net technology and supports Windows Vista.

Bloomberg has a range of order management products-Bloomberg Portfolio Order Management System (POMS) for the institutional asset manager; Portfolio Order Management System for Alternative Investors (POMS-AI); Trade Order Management System (TOMS) for fixed-income broker-dealers; and Sell Side Equity Order Management System (SSEOMS) for sell-side equity trading desks.

Charles River Trader from Charles River Development provides tools for the entire trading process from counterparty discovery, trade placement, execution, and allocation to downstream trade processing. The global system provides full multi-currency capabilities, supports equity, fixed income, derivatives and foreign exchange trading.

Best Portfolio Management System

SunGard Delivers

SunGard wins this year for best portfolio management system in a tight race. Asset Arena is SunGard's family of solutions for the investment management business. The solution's Portfolio Management is a global, real-time, browser-based portfolio management, trading, accounting, performance measurement and reporting system designed to meet the needs of an investment management firm. Portfolio Management focuses on integrating the front and back office by automating the pre- and post-trade settlement cycle to achieve internal and external straight-through processing (STP).

With an easy-to-manage, application service provider (ASP) environment, Portfolio Management is aimed at streamlining and integrating the investment management process. It offers robust portfolio modeling and rebalancing, global order management, performance measurement, portfolio accounting, online and custom reporting, standard or custom compliance checks, automated post-trade settlement processes and automated reconciliation and exemption identification. The platform features a uniform, Web-deployed customizable interface that reports in real-time, so investment managers can be T+0 enabled. The end-to-end solution integrates the front and back office by automating the pre- and post-trade settlement cycle to achieve internal and external STP with open application programming interfaces.

Asset Arena also includes Manager-decision support for investment managers; Trader-global electronic trading and order management for asset managers; Compliance-pre-trade, post-trade and end-of-day compliance for asset managers; Performance-performance measurement and attribution for institutional asset managers; Investment Accounting-for global institutional asset managers; and Investor Account Management-a transfer agency solution for European fund service providers.

Last year's winner, Charles River Development, provides a solution with tools for the entire trading process. A global system, Charles River Trader provides full multi-currency capabilities, supports equity, fixed income, derivatives and foreign exchange trading.

Best Execution Management System

ITG Inches In

It has been a steady rise up the execution management system (EMS) ladder for agency brokerage and technology firm ITG after it finished second in the EMS category of last year's Waters Rankings. Nudging Bloomberg out of the top position this year, ITG's Triton and Radical systems have now been crowned as the best in the EMS business.

Although subtly different in their functionality, Triton and Radical are closely linked members of the ITG family. Both are classed as an EMS, and can boast fast execution management, consolidated order books and, crucially, broker neutrality. But where Triton offers execution on entire portfolios, Radical is aimed exclusively at single-stock execution and typically appeals to latency sensitive hedge funds. First launched for the buy side more than three years ago, Triton brings together a number of key trading tools, including pre-trade analytics, execution and transaction cost measurement. The system has gathered more than 200 clients, mostly long-only asset managers who may use the system across several desks within the organization. The proof of Triton's strength is that ITG itself uses the product on its own agency brokerage trading desk. With Triton as a full-service EMS and Radical pitched more to the high-frequency hedge funds, ITG has a steadfast hold on the EMS market and deserves its new title.

Although not working on any particular functionality at the moment, ITG's biggest challenge is to keep the products especially in Europeon top of the post-Markets in Financial Instruments Directive (MiFID) changes and make sure they are connected to any new liquidity venues or multilateral trading facilities.

Bloomberg has been narrowly nudged from the top position it occupied in last year's Rankings. The vendor's EMS was first launched in 2005 and provides order handling, analytics, execution and transaction cost analysis on equity and fixed-income transactions. The EMS is available at every Bloomberg terminal at no extra charge to existing customers, making it a very attractive option to those buy-side firms that subscribe to Bloomberg and might want to try an EMS without making a major financial commitment.

Best Enterprise Data Management Solution

A New EDM Winner-Sybase

Enterprise data management remains one of the most vexing issues that a firm's team of technologists can face. Compared with managing an overwhelming and ever-increasing wave of data that often comes in proprietary formats, building a trading floor or a grid network is a walk in the park. Once a data manager comes close to reaching the elusive golden copy of data, a wily CEO announces a merger that throws the project into disarray. Add in regulatory compliance with evolving standards and the chaos grows.

Although some investment firms balk at outsourcing data management to a third-party firm entirelytheir data is their lifeblood, after allthey have little qualms about working with data management experts to oversee that myriad data floating around the enterprise.

This year a new winner claims the mantle of Best Enterprise Data Management Solution: With 33 percent of the votes, it's Sybase with a solid lead. IBM retains its second place holding with a respectable 22 percent of the votes and SunGard comes in third with 13.7 percent of the tallies, which is down from 18.4 percent last year. Last year's winner, Accenture, did not place in the top three.

To address EDM challenges such as data mining, predictive modeling, reporting and business intelligence, the winner offers Sybase IQ, which is a highly optimized analytics server to handle vexing data warehousing chores. In today's mish-mash of back-office systems, it works with a multitude of operating systems, hardware platforms, and analytics applications. Sybase IQ delivers answers up to 100 times faster, according to company claims. Sybase is an enterprise data manager's best friend.

As always, business leaders and technologists recognize the necessity for clean reference data and EDM has made its way up the mission critical ladder. But sorting out siloed data warehouses and data quality issues is no easy task and the competition between EDM vendors remains fierce.

Best Streaming Data Management Solution

StreamBase Stays on Top

Managing streaming data remains crucial to the process of trading securities. Over the past year, increased regulatory pressure and soaring trade volumes have opened the data flood gates even further. At the New York Stock Exchange (NYSE) alone, roughly 500,000 trades and quotes were produced per day in 1993. According to third-place winner Kx Systems, that figure today has risen to 500 million ticks and many predict it won't take long to reach the 1 billion mark. As the data deluge continues, firms on both the buy and sell sides have had to re-evaluate the way they manage their streaming data if they are to remain competitive and compliant. In such an environment, competition among the streaming data management providers has only intensified.

StreamBase Systems has held onto the lead it acquired over SunGard in last year's Waters Rankings. The Lexington, Mass.-based vendor has built its data management offering around complex event processing (CEP), which allows applications to analyze and act on real-time streaming data for instantaneous decision-making. Version 6.0 of the platform was unveiled last month, described as a "major milestone in the maturity of CEP technology." The new version enables enhanced development, testing and deployment of the software and includes the StreamBase Visual Debugger, which allows users to more easily find and correct errors in CEP applications. Earlier this year, StreamBase partnered with Vhayu Technologies to deliver a best-of-breed platform for the storage and analysis of both real-time and historical data. The combined offering responds to the needs of both hedge funds and investment banks for CEP software that is tightly integrated with a high-performance tick database.

Trailing StreamBase in second and third places this year are SunGard and Kx Systems, respectively. A newcomer to the top three, Palo Alto-based Kx Systems has just celebrated 15 years of business, during which it has been quietly plugging away at the challenge of dealing with rising data volumes. The vendor's Kdb+ database has a unique recipe for handling data and has been installed by some of the largest investment banks on the Street.

Best Exchange Data Feed

NYSE Euronext Triumphs

Data management may be a crucial consideration for banks and money managers, but just as important for traders is making sure the exchanges themselves have up-to-the-second data feeds. Racing ahead of competitor Nasdaq OMX, NYSE Euronext has been crowned king of the data feeds this year, perhaps a recognition that the exchange's ambitious acquisition strategy is paying off.

After merging with Euronext last year, the integration of the two exchanges is well under way, and NYSE benefits from a strong foothold in both the US and European markets. In March this year, NYSE closed a smaller acquisition, but one which holds no less significance for market data consumers. By buying Wombat Financial Software for $200 million, the exchange considerably enhances its market data capabilities. Founded in 1997, Wombat is an expert in providing high-performance data management software and will prove a boon to its parent exchange. Wombat joins recently acquired TransactTools as part of NYSE Euronext's Advanced Trading Solutions division, which combines high-performance connectivity software with Wombat's data management and distribution expertise. "Wombat bridges our commercial technology and market data strategies, broadening our customer reach and enabling NYSE Euronext to deliver advanced technology solutions to our customers' increasing data management challenges," said CEO Duncan Niederauer when the deal was signed in January.

Trailing its cross-town competitor by only a few votes, Nasdaq OMX continues to add value for its customers through advanced data feeds built off the acquisitions of the Brut and Inet ECNs in 2004 and 2005, respectively. Nasdaq provides a number of different data feeds, mostly based on Inet's ITCH protocol, distributing orders as they are presented in the matching engine. The ITCH protocol is reliable, scalable and well-trusted by its users.

On the other side of the Atlantic, the London Stock Exchange (LSE) lost out to Nasdaq OMX by just one vote. The LSE's Infolect feed is the successor to London Market Information Link (LMIL) and now disseminates market data to more than 135,000 screens in 100 countries at an average throughput latency of just 2 milliseconds.

Best AML Compliance

Mantas Rules Again

For the second year running, Mantas was the overwhelming winner in the best anti-money laundering (AML) solution provider space, with 72.8 percent of the votes.

The Mantas AML solution provides automated, comprehensive and consistent surveillance of accounts, customers and correspondents across business lines for suspicious activities and possible money laundering. The product allows firms to leverage their compliance investment across business lines and to ensure a common level of compliance throughout the organization.

Mantas was bought by i-flex Solutions in October 2006, and its suite of risk and compliance solutions fall under the Reveleus GRC brand. I-flex is soon to be renamed Oracle Financial Services pending regulatory and shareholder approvalsits parent, Oracle Corp. owns 81 percent of the company.

Mantas AML uses pattern recognition to identify suspicious behavior. It analyzes the behaviors of customers, employees and partners in every transaction across the enterprise. It detects sudden, significant changes in the transaction activity of an account, as well as tracking transactions by suspect parties or those in high-risk areas. The system also tracks secret or hidden relationships between entities and accounts, and monitors other behavioral parameters that suggest illegal activity.

This year, Mantas has focused on emerging markets. Korea Exchange Bank implemented Oracle Mantas in April, and in January, Mantas enabled AML compliance at First Bank of Nigeria.

SAS' bespoke, risk-based solutions work alongside rules-based monitoring systems to identify high-risk entities whether or not a suspect transaction has occurred, and are available as hosted solutions. GIFTS Software is a single source provider of AML and OFAC compliance solutions as well as integrated funds transfer, investigation and compensation, and Web-based cash management systems. Fortent provides banks, brokerages and insurance companies with solutions that meet regulatory requirements, streamline operations and combat financial crime. Fortent delivers Know Your Customer and transaction monitoring for AML and fraud detection and prevention.

Best Risk Management

Thomson Reuters Soars

Risk management is the hot topic on everybody's lips this year. In the aftermath of the sub-prime crisis and the rogue trader scandal at French bank Société Générale, cautious firms throughout the industry have turned their attention to how they can better manage risk.

Thomson Reuters' middle-office product line includes functionality for managing market and credit risk and comprehensive features for settlement, clearing, the generation of accounting entries and cash management. Reuters Kondor Global Risk, the vendor's solution for limit management, consolidates credit limit information and manages the data in real time across all instrument types. Credit and risk managers benefit from the ability to monitor credit exposures, enabling efficient limit utilization across the enterprise. Its scaleable architecture makes it suitable for single-site as well as global institutions. Traders can also perform limit enquiries and reservations, and receive limit updates in real-time.

Reuters Kondor Value at Risk, the vendor's credit and market risk management tool, delivers high-end analysis and a global view on both market and credit risk. It integrates seamlessly with Kondor+, Thomson Reuters" deal capturing system, as well as other third-party position-keeping systems and enables users to produce consolidated enterprise-wide risk information on all activities. The system supports a range of risk analysis methodologies and drill-down capabilities that enable users to identify and attribute risk to its original sources. Risk can be analyzed in terms of market factors such as interest rates, equity prices, currencies and volatility and reports distributed anywhere in the organization via a corporate intranet.

SunGard's Adaptiv provides enterprise-wide credit and market risk management and operations solutions. BancWare is an integrated solution suite for asset/liability management, budgeting and planning, regulatory compliance and profitability, used by banks, mortgage and credit lenders, and other financial services firms.

SAS' risk management offerings include Credit Risk Management for Banking, Market Risk Management, Operational Risk Management and a product for risk-based performance management.

Best Trading Turret

IPC Tops Turret Market

In an age increasingly dominated by electronic trading tools, voice communication still remains as crucial as ever and the market is just as competitive, dominated by BT Trading Systems and IPC. Having held the winning position for three years, IPC was elbowed into second place last year but bounces back ahead of BT in the 2008 Rankings.

IPC has been at the forefront of Voice over Internet Protocol (VoIP) for the last eight years. While some large trading floors have shown reluctance to make the jump from traditional turrets to VoIP, IPC has done all it can to ease that transition since it first introduced VoIP for its trading turrets in 2001. The vendor has deployed more than 54,000 VoIP desktops and 85 percent of its rollouts are now done with VoIP. An IPC client in London, JPMorgan Cazenove, was one of the first clients to make the switch to VoIP and has reaped massive benefits. "Before we made the change, we had a network team and a traditional telecoms team, but now we have a converged voice and data network team of just five people," Cazenove's network services manager recently told Waters. "In the four years since we deployed IP turrets, we haven't had a single outage." Headquartered in Jersey City, NJ, IPC employs 1,400 people and has a global presence extending to 40 countries. Recent client contracts include the Bank of New Zealand, which upgraded all of its trading floors to IPC's IQMX enterprise system, and MIDF Amanah Investment Bank, a Malaysian bank that earlier this year rolled out the IQ/MAX VoIP turrets.

BT Trading Systems may be second fiddle to IPC, but it is right at the front of the race, with VoIP also available on its ITS turrets as well as traditional time division multiplexing (TDM). The ITS product offers all the necessary communication functionality of a trading turret and also features an intuitive user interface with simple controls and color displays. ITS Anywhere, a soft version of the turret, allows users to log in remotely from the home phone, BlackBerry or cell phone-an important feature with today's focus on disaster recovery.

Best Financial Network

BT Radianz Still Unbeatable

In one of the few categories to remain completely unchanged in this year's rankings, BT Radianz has clinched a fifth successive victory in the race to be the best financial network provider. Since 2004, Waters readers have consistently voted for Radianz and that trend shows no sign of changing just yet.

BT Radianz boasts a shared market infrastructure that connects its clients to a huge range of pre-trade, trade and post-trade applications from leading providers across the straight-through processing chain. Ever since it was founded in 2000 as a joint venture between Reuters and Equant, Radianz has placed the highest value on providing top-class connectivity to the venues and tools that traders need to be effective.

Backed by the likes of Merrill Lynch, Morgan Stanley and Thomson Financial, Radianz was acquired by BT in 2005 but has never stopped focusing on its core competency: connectivity. This year alone is a case in point. In January, the vendor announced that the New York-based International Securities Exchange (ISE) would use its network for trade execution and market data. In April, BT added alternative trading system Chi-X Canada to its Radianz Shared Market Infrastructure and last month, the vendor became a global supplier of connectivity services to Telekurs, connecting that vendor's platform to 10,500 financial sites globally.

Remaining in second and third place, respectively, this year, Swift and ITG jointly occupy the shadows of BT Radianz. Swift boasts a well-respected financial network that caters to the needs of the smallest and largest market participants. Users can connect directly to Swift through several tools or indirectly through another member or a shared connection. At its annual Sibos conference in Boston last year, Swift put in place a competitive new pricing structure that took effect from the beginning of 2008. High-volume clients can now opt for a fixed fee pricing scheme for messaging and Swift also introduced a 15 percent rebate and a 5 percent reduction for FIN messaging.

Best Networking Infrastructure Firm

Cisco Reigns Supreme

Networking infrastructure providers are the unsung heroes of financial services. Where would we be without instant phone, e-mail or Internet connections to colleagues and business partners from fixed line or mobile devices anywhere in the world? With thousands of miles of cables spanning continents and lining the ocean floor, the companies in this category make up the nervous system of the business. For the second year in a row, Waters readers named Cisco Systems the best networking infrastructure provider.

Cisco still leads when it comes to developing intelligent information networks that are scalable, adaptable and cost effective. Cisco's Intelligent Information Network (IIN) turns the traditional IT "cost center" into a strategic tool that seeks to enable sophisticated IT functionality, such as virtualization, telepresence, application integration, and optimization that streamlines IT processes.

The increased adoption of advanced video communications in the enterprise space-such as Cisco TelePresence-is having a profound effect on Internet Protocol (IP) usage. Cisco estimates that the increasing use of visual networking-desktop videoconferencing, video streaming and Web 2.0 social networking and collaboration applications-will push IP traffic up 46 percent from 2007 to 2012, nearly doubling every two years. This will result in an annual bandwidth demand on the world's IP networks of about 522 exabytes, or more than half a zettabyte.

BT recently launched a service that lets customers integrate data, voice and other multi-media applications through a single connection. MarketPulse delivers voice over IP to the trading room using Radianz Shared Market Infrastructure, and is based on the open session initiation protocol (SIP).

The Verizon Business global network includes more than 485,000 route miles, including terrestrial and undersea cable, spanning six continents and access to another 187,000 route miles from Verizon Telecom.

This year AT&T launched a $1 billion initiative to extend its global services, reach and access into additional locations in Europe, the Middle East, Asia and in the US.

Best Business Process Management

IBM Keeps Firms Nimble

Talk about an upset. After three straight years of winning the top spot in the Best Business Process Management (BPM) category, Tibco drops to third place and gives up the top spot to IBM. Last year's second place winner, IBM, was more than 13 percent points away from first place Tibco and now it is as many points ahead of the former winner. This year, Oracle takes second place with 23.9 percent of the votes after it moved to acquire BEA Systems, a respected player in the business process management space, which came in third place last year.

Why the upset in the world of BPM? In a few words, investment firms are automating like never before in the race for greater efficiencies in a changing world. In order to keep growing, firms must be able to deal with unforeseen issues, such as mergers and acquisitions, global expansion, increased regulatory compliance measures and so forth. Therefore, streamlining and monitoring procedures and operations can give a much needed sense of control in an ever-changing world. BPM often works hand-in-hand with software oriented architecture (SOA) to perform and oversee these mission-critical yet often mundane tasks.

In April, IBM announced the release of IBM WebSphere Business Events, a suite of tools that aims to provide technologists and the business lines with the ability "to identify and analyze cause-and-effect relationships among events in real time to make proactive business decisions," according to the IBM Web site. Based on technology Big Blue acquired from Aptsoft in January, the solution finds the connections between different events, evaluates trends on the fly and identifies possible opportunities and threats. After absorbing key BEA Systems technology and practices, Oracle offers its line of BPM solutions as a set of open, standards-based Oracle Fusion Middleware components for modeling, executing, managing, and optimizing business process applications. Oracle BPM exploits closed-loop engineering to close process gaps and deliver control over a firm's business process lifecycle.

Best Complex Event Processing Solution

Oracle Views Victory

We are living in an age of complex events. When news breaks, traders and their algorithmic trading systems have to determine whether the new situation warrants a buy, sell or hold option. Complex events can range from political elections, fires inside a factory or back office, disastrous weather or an everyday financial earnings report. Big news can have a big impact, and this why Waters is introducing the category of Best Complex Event Processing Solution.

In the first votes for Best CEP, the clear winner was Oracle with 27.7 percent of the votes, followed by IBM with 22.2 percent and Portware in third with 8.8 percent of the votes. Despite the fact that there are several well-known players in the CEP space, Oracle, thanks to its acquisition of BEA Systems earlier this year, enjoyed a solid lead among the competition.

As part of its database and service oriented architecture divisions, Oracle's CEP solution takes aim at pattern matching, time and data-based windows for event evaluation and an extensible framework to support user-defined analysis and functions. The real-time pattern matching, for example, defines and identifies complex event patterns so that firms can see trends as they happen. The solution is customizable and allows investment firms to process hundreds of thousands of events per second.

According to Oracle, its solution is also "hot-pluggable," which allows firms to analyze events across heterogeneous system sources and direct output for visualization or automated response to the Oracle SOA Suite or other solutions.

The second place winner, IBM, delivers a solution called, straightforwardly enough, CEP, which it calls "a lightweight and agile complex event processing engine [that] aims to ease the cost of changing business logic, automating and monitoring business processes, and enabling an on-demand business environment." It looks for everything, including suspicious money transfers, signs of fraud, market trends and more.

Best Server Virtualization

VMware Virtual Champs

For a category that tackles virtualization, this year's winning lineup is eerily familiar. In the Best Server Virtualization category, the same vendors won in the same places as last year but with a greater spread in the percentage of votes. VMware, an EMC company, took first place with a striking 53.4 percent of the votes, which allowed it to far outstrip the second place winner, GemStone Systems, which clocked 12.7 percent of all votes. GigaSpaces came in third place with fewer than 10 percent of the votes this year.

Judging by these results, the server virtualization market appears to have a clear industry favorite as the concept of server virtualization continues to gain ground with ambitious investment firms.

Although grid networks in one shape or another have been around Wall Street and the City for nearly a decade or more, most server virtualization projects are just getting off the ground. VMware, with clients from Merrill Lynch, Mechanics Bank, Commerzbank, Russell Investments Group, UMB Financial Corp. and others, offers a robust range of solutions that virtualizes both idle desktop PCs and back-office servers.

VMware's offerings include VMware Infrastructure 3, which virtualizes servers, storage and networks, to transform IT infrastructure into an automated, always-on computer "utility plant," according to company claims. The solution aims to manage IT infrastructure efficiently, bring mainframe class availability and reliability to x86 datacenters, and has the ability to run the most demanding applications in a virtual environment. For an automated data center, VMware offers VMware ESX, the "hypervisor" application that abstracts server processor, memory, storage and networking resources into multiple virtual machines.

Virtualizing idle resources like CPUs and servers is an important aim for investment firms. Bank technologists can manage multiple applications and operating systems within a single physical system. Servers can be consolidated into virtual machines on either a scale-up or scale-out architecture. Finally, computing resources are treated as a uniform pool that can be doled out to virtual machines in a tightly managed manner.

Best Grid Infrastructure Solution

Big Blue, HP: Grid Kings

Building a bare-bones grid was fairly easy years ago: Gather a bunch of servers, network them together with some grid scheduling software and throw in a few high-performance calculation projects and walk away. Voilà-you have a high performance grid.

Maintaining and growing a modern grid is a different matter altogether. Today's grid networks have to be ready for tomorrow's spikes, demands and growth patterns. Ask any grid team manager at a major Wall Street firm and nearly everyone will admit that they have a mandate to grow their grids. Even in a tight economy with a chill on IT budgets, grid infrastructure is a serious mission that cannot be delayed.

This year's winners are a Who's Who of grid infrastructure providers and the fact that the winners resulted in a virtual tie means that the solutions are mature and the demand from the investment firms is sky-high. Last year, IBM was the clear winner in this category and Hewlett-Packard did not even place in the top three. This year, they tie for first place. This confirms Big Blue's ongoing commitment to grid infrastructure. For HP, this is an impressive step forward but it shouldn't be too surprising. The computing giant is a strong presence in maintaining the infrastructure of a growing and eventually green grid.

Microsoft and DataSynapse switched positions this year with Bill Gates' company in second place with 22.4 percent of the vote and DataSynapse earning 14.6 percent of the vote.

All firms in this space are addressing similar needs: providing adequate compute power to the trading floor and data managers, dispersing large-scale projects across the globe in follow-the-sun architecture, and keeping the chips cool and ready for the next hot project. Cooling, to say the least, is the next big issue grid infrastructure solution providers are tackling as data centers and investment firms' back offices become resource hogs for a seemingly fragile environment. Although the future is uncertain for many in the financial services arena, one thing is certain: Grids will grow and teams of dedicated experts will have to manage them.

Best Outsourcing Partner

Take a Bow, Infosys

The outsourcing trend shows few signs of abating and is especially appealing to financial services firms in the current economic downturn. Over the years, outsourcing has matured and firms are looking to outsource more specific functions than in the past. As budgets tighten, firms see more and more benefits from focusing on their core competencies and outsourcing the rest.

In a very close race, Indian giant Infosys took the prize for best outsourcing partner for the second year running. Infosys, based in the outsourcing hub of Bangalore, helps capital markets firms build new products or services and implement business and technology strategies.

Infosys uses a global delivery model to accelerate schedules with a high degree of time and cost predictability. The consulting and IT services firm offers application and infrastructure, enterprise, research and development, consulting, and business process outsourcing services. These services include supply chain management, customer relationship management, enterprise resource planning, identity management, testing and automation, and corporate performance management.

Infosys' core banking solution, Finacle, demonstrates the vendor's ability to leverage a repository of global skills and resources to provide solutions across a wide spectrum of technologies. This modular solution addresses the core banking, treasury, wealth management, consumer and corporate e-banking, mobile banking, alerts and Web-based cash management requirements of retail, corporate and universal banks worldwide.

Infosys released a standalone Islamic banking solution earlier this year, which follows accounting standards recommended by Audit and Accounting Organization for Islamic Financial Institutions (AAOIFI). The solution was unveiled as part of the global launch of version 10 of the Finacle Universal Banking Solution.

Services offered by second place HP include application management, business process outsourcing, end-user workplace services, infrastructure management, service desk and software supply chain management. IBM offers a range of infrastructure outsourcing and data center hosting services.

Best Corporate Actions Solution

ActionsXchange Wins

Changing a company's name, splitting stocks and making dividend or coupon payments can have a huge impact on the price of a company's shares. If the value of the corporate stock or debt changes radically, the impact in the market is immediate. If you witness one of these events, you will recognize the need for corporate actions solutions. With this in mind, Waters adds a new category to our Waters Rankings to recognize the best corporate actions solution.

The winner is Fidelity ActionsXchange with 23 percent of the votes. The Depository Trust and Clearing Corp. (DTCC) earned second place with 20 percent of the votes and SmartStream took third place with 18.4 percent of all tallies. With less than 6 percentage points between first and third place, this reveals a tight and competitive space.

As an offering from its powerhouse buy-side parent company, Fidelity ActionsXchange was formed in 1997 to provide investment firms with corporate actions processing. Today, it partners with more than 50 major global financial institutions. By self-sourcing data on companies that comprise more than 90 percent of the world's market capitalization and supplementing with multiple market data feeds, ActionsXchange claims to deliver up-to the minute corporate actions information. ActionsXchange updates its database constantly and the updates are made available through a Web browser. The solution gathers data from major data providers such as DTCC, Xcitek, Telekurs, and Exchange Data International, plus company Web sites, securities exchanges, and newswires. These entities encompass 238 countries for 89 corporate actions types on more than 1.3 million securities.

Second place winner DTCC tackles this category with its line of Global Corporate Actions (GCA) solutions. The GCA Validation Service provides "scrubbed" corporate actions announcement information on global securities. As an entity, the DTCC provided information on roughly 900,000 corporate actions for 1.6 million securities in more than 160 countries in 2006.

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