Nasdaq (Nasdaq: NDAQ) today announced the new AI powered feature
within its Market Surveillance technology solution that will
significantly enhance the quality, speed, and efficiency of market
abuse investigations performed by our clients. The solution
leverages generative AI to streamline the triage and examination
process involved in investigating suspected market manipulation and
insider dealing, empowering regulator and marketplace clients to
more effectively monitor and detect potential market abuse.
During proof-of-concept testing, surveillance
analysts estimated a 33% reduction in investigation time, with
improved overall outcomes. This represents a substantial gain in
investigation efficiency. Nasdaq is planning to leverage the
generative AI enabled functionality for its U.S. equity market
surveillance.
“Maintaining trust in capital markets is critical
to preserving long-term growth and prosperity,” said Ed Probst,
Senior Vice President and Head of Regulatory Technology at Nasdaq.
“Market abuse is a substantial global challenge and one that
demands increasingly sophisticated solutions to address it. As a
major regulatory technology provider to the world’s financial
system, with a deep culture of innovation, Nasdaq is uniquely
placed to leverage the power of technology to further enhance the
tools and capabilities necessary to uphold the integrity of
marketplaces globally.”
New AI Surveillance
Capabilities
In an effort to ensure market integrity and
trustworthiness, international regulators require financial
institutions to demonstrate the ongoing effectiveness of their
surveillance systems and controls. Firms are expected to have
comprehensive coverage across their entire portfolio and
operations, spanning a broad range of asset classes and
jurisdictions, with scalable systems capable of managing increased
levels of risk during periods of high volume and volatility.
Today, when analysts receive automated alerts of
suspicious activity, they must conduct an initial review and form
an assessment of whether the activity warrants further
investigation. That typically involves manually collating all
necessary evidence, including relevant trading activity and
corporate filings alongside a vast array of data from external
sources, before deciding whether to continue the review. The
process is highly resource intensive, and even more so if the alert
warrants further investigation.
Leveraging Amazon Bedrock, an AWS service for
building secure generative AI applications, Nasdaq’s enhanced
functionality will empower analysts with generative AI capabilities
to distill, analyze, and interpret relevant information more
quickly, enhancing their ability to form detailed initial
assessments of alerts. For example, the technology can produce a
consolidated table of the company’s regulatory filings, summaries
and links to company, sector, and peer company news, news sentiment
analysis, and other mitigating or aggravating factors that may
impact any given security.
Tony Sio, Head of Regulatory Strategy and
Innovation at Nasdaq, said: “By drawing on the
latest innovation in cloud technology and artificial
intelligence, we can better respond to new threats and offer the
global financial system advanced tools to more effectively tackle
market abuse. This is a continuous cycle of investment and
improvement in our capability, leveraging our unique position as
both a world class market operator and best in class surveillance
technology provider around the world.”
Scott Mullins, General Manager of Worldwide
Financial Services at AWS, said: “Nasdaq is continuously innovating
on behalf of the global capital markets by combining its
industry-leading expertise with cloud and AI technology. We are
honored to work with Nasdaq as it harnesses the power of generative
AI to advance the stability and security of the global financial
system.”
Nasdaq’s Expansion of AI Across Multiple
Business Units
As a global technology provider, Nasdaq has continuously
advanced AI capabilities to support capital markets, enhancing the
integrity, fairness, liquidity, and efficiency of the financial
ecosystem. This new generative AI functionality has been introduced
as part of Nasdaq's broader research and development effort,
focused on transparent, reliable, and accountable AI implementation
across the financial services industry.
A major aspect of Nasdaq’s AI strategy has been to
accelerate its market modernization effort by improving the quality
of its data and surrounding systems while embracing cloud-enabled
infrastructure. Nasdaq’s long-term approach to technology and
investments has enabled the company to unlock the power of AI by
scaling its capabilities, tools, and systems with proper
governance, security, and oversight. To date, Nasdaq’s AI
initiatives span many of its business units, including North
American Markets Services, Financial Crime Management Technology,
and Corporate Solutions.
Within North American Market Services, Nasdaq has
launched Dynamic MELO, the first SEC approved AI order type, and
Strike Price Optimization, a purpose-built program designed to
align Nasdaq’s six options exchanges strike lists to market demand.
For several years, the Nasdaq Investor Relations Intelligence team
has also been employing different types of AI to better serve
clients, with a key focus on empowering analysts to uncover new
proprietary data and insights more efficiently. In addition, IR
Intelligence recently launched Nasdaq Sustainable Lens™, an
AI-powered ESG intelligence solution that helps clients make better
decisions faster, boost productivity and enhance credibility on key
topics such as regulatory reporting readiness and competitive
intelligence. In addition, Verafin, which provides Nasdaq’s
Financial Crime Management solutions, announced the availability of
its Entity Research Copilot, the first of its integrated Copilot
capabilities that uses generative AI to automate compliance tasks
and daily workflows enabling financial institutions to reduce
operational costs and increase the efficiency of anti-financial
crime programs.
About Nasdaq
Nasdaq (Nasdaq: NDAQ) is a leading global
technology company serving corporate clients, investment managers,
banks, brokers, and exchange operators as they navigate and
interact with the global capital markets and the broader financial
system. We aspire to deliver world-leading platforms that improve
the liquidity, transparency, and integrity of the global economy.
Our diverse offering of data, analytics, software, exchange
capabilities, and client-centric services enables clients to
optimize and execute their business vision with confidence. To
learn more about the company, technology solutions, and career
opportunities, visit us on LinkedIn, on X @Nasdaq, or at
www.nasdaq.com.
Cautionary Note Regarding Forward-Looking
Statements:
The matters described this press release contain
forward-looking statements that are made under the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
When used in this press release, words such as “expect,” “enables,”
“will,” “planning,” “can,” and similar expressions and any other
statements that are not historical facts are intended to identify
forward-looking statements. These statements include, but are not
limited to, statements regarding Nasdaq’s AI powered feature within
its Market Surveillance technology solution and other uses by
Nasdaq of generative AI in its solutions and offerings. We caution
that these statements are not guarantees of future performance.
Actual results may differ materially from those expressed or
implied in the forward-looking statements. Forward-looking
statements involve a number of risks, uncertainties or other
factors beyond Nasdaq’s control. These factors include, but are not
limited to, factors detailed in Nasdaq’s Annual Report on
Form 10-K and its other periodic reports filed with
the U.S. Securities and Exchange Commission. We undertake no
obligation to release any revisions to any forward-looking
statements.
Media Contacts:
Emily Pan+1 646-637-3964Emily.Pan@nasdaq.com
Andrew Hughes+44 (0)7443
100896Andrew.Hughes@nasdaq.com
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