Sstock exchange operator and financial services provider Nasdaq Inc. (NDAQ) has entered into a multi-year collaboration with Amazon Web Services, Inc. (AWS), a unit of Amazon.com Inc. (AMZN).
The two entities will combine their expertise to build a state-of-the-art cloud-based infrastructure for global capital markets. Shares of NDAQ closed down 2.8% at $203.23 on November 30.
Since 2008, Nasdaq has used the elasticity and high security of AWS to deliver customer-centric solutions. With this partnership, Nasdaq will begin migrating its North American markets to AWS gradually starting in 2022.
The first to migrate will be the Nasdaq MRX, which is an American options market, followed by the others.
Cutting-edge technology for capital markets
The two entities have co-developed a new edge computing solution exclusively dedicated to market infrastructures. The solution will also use AWS Outposts, which can extend its infrastructure, services, and tools to any data center, location, space, or on-premises facility.
AWS Outposts enable ultra-low latency edge computing capabilities and Nasdaq intends to integrate it into its core network. This will make Nasdaq the first-ever private AWS Local Zone for the capital markets industry.
The new infrastructure will provide Nasdaq customers with ease of use and high-frequency trading capabilities, combined with access to virtual connectivity services, market analytics and machine learning. Additionally, the new solution will accelerate Nasdaq’s business and enable the exchange to effortlessly process billions of dollars in daily transactions.
The solution could also be used by other market participants and exchanges to migrate their trading systems to the cloud.
Solutions for the global economy
In addition to the current partnership, the two entities will also explore ways to use AWS cloud capabilities in other Nasdaq solutions, including anti-financial crime, data and analytics, and enterprise software solutions. market infrastructure.
The Nasdaq has more than 130 infrastructure customers, including exchanges, banks, clearing houses, central securities depositories and regulators. These clients rely on the Nasdaq for activities such as basic trading, clearing, settlement and monitoring technology. For the efficient operation of these businesses, Nasdaq plans to partner with AWS to build viable public and hybrid cloud models.
Chairman and CEO of Nasdaq, Adena Friedmansaid, “This historic partnership with AWS aims to power a truly cloud-based market infrastructure that is more resilient, scalable, and accessible to all market players…Our innovative new collaboration with AWS creates a bridge to the future for our markets and represents the next major step in the Nasdaq’s cloud journey.
AWS CEO, Adam Selipskisaid, “Together, Nasdaq and AWS will change what is possible for financial markets organizations, helping them accelerate innovation and improve business processes…Our partnership will give Nasdaq a way to more easily move its core infrastructure to the cloud and innovate new services. as they continue their second decade of cloud adoption.
The Wall Street community is cautiously bullish on NDAQ stock with a Moderate Buy consensus rating based on 6 buys and 3 takes. The Nasdaq average price target of $218.11 implies upside potential of 7.3% from current levels.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.