Vanguard is looking to simplify the index data sharing process by using blockchain technology to move the data onto a single decentralised database.
Working alongside the Centre for Research in Security Pricing (CRSP) and technology provider Symbiont, Vanguard explained the data can be moved instantly between index providers.
CRSP has been distributing daily index data to Vanguard over the past few months in a testing environment using Symbiont’s blockchain-powered platform.
Warren Pennington, principal in Vanguard’s Investment Management Group, explained investment managers using the platform could see significant cost savings.
“Investment managers will be able to instantly distribute, receive, and process index data, resulting in better benchmark tracking and significant cost savings that potentially results in better returns for our clients,” he said.
Index data distribution traditionally relies on multiple parties and transmission channels to reach investment professionals, although it is essential to many operations within financial services.
Mark Smith, CEO and co-founder of Symbiont, added: “Through this collaboration we were able to show how Symbiont’s blockchain technology and smart contracts can enhance market data distribution among disparate parties.”
Following the success of the initial pilot, Vanguard said CRSP index data delivery will be automatically distributed using the blockchain private network from early next year.