Market movements go orchestral
Floor traders sound out new software that uses musical instruments to track stocks
The brokerage floors are alive with the sound of music.
In New York City, the financial capital of the world, trading houses such as CSFB, Citigroup and Morgan Stanley are testing new software that translates market movements into sound.
The idea behind the program, developed by United States-based Accentus, is to give visually overloaded traders a new way to monitor the markets. Founder and chief scientific officer Edward Childs pointed to academic studies that showed traders registered a 15 per cent improvement in the ability to monitor as many as eight securities when using the auditory software.
Hear a bassoon emanating increasingly higher notes? That means the Dow Industrial Average is ticking up. An electronic sound with dropping notes indicates the technology-laden Nasdaq Composite Index is falling.
'We try to use instruments that have some kind of character related to the index security,' Mr Childs said. 'The bassoon has a kind of industrial sound ... like a kind of low factory whistle.'
Accentus has yet to develop a program for the global market but localised versions could see the software incorporating instruments familiar to traders in Asia, where groups such as Twelve Girls Band have a wide following. The Hang Seng Index might be represented by the pipa, while the erhu is assigned to H-shares.
'For the international scene, I think there's going to be certain kinds of idioms and sounds that people are not used to [in the US version],' Mr Childs said.
Accentus has installed its software at more than 50 trading terminals in the US. Companies pay an installation fee of US$10,000 to US$15,000, along with a monthly subscription ranging between US$250 and US$350 per terminal.
'What the companies are doing right now is paying for pilots. We've been focusing on proof of concept,' Mr Childs said.
Sounds can be customised to fit whether someone is a fixed-income trader, a portfolio manager or a dealer of complex derivatives.
'We help traders choose the Accentus music displays that best suit the kind of data that they're looking at,' Mr Childs said.
But the company also hopes to establish 'Accentus sounds' so that traders always associate the bassoon with the Dow, regardless of which brokerage they work for.
'We think the software will have more value if we're consistent with the sounds,' Mr Childs said.