Optimising the post trade process

Your legacy post trade system might feel familiar but the truth is, it's holding your trading business back. Legacy systems are expensive, especially for mid-sized firms, and when something goes wrong it’s slow and costly to fix. Your post trade processes should work like your favourite smartphone, instantly and effortlessly. 

There are better, faster, and more efficient options out there. And while your existing system might once have been reliable, you know better than us - it’s now slower, difficult to integrate with more modern technologies, and its inflexibility, like only being able to export data in specific formats, is only making it harder for you to adapt and change.

What we see is that in an industry where speed and accuracy are non-negotiable, any form of outdated technology will put your firm at a disadvantage. Even if only a few manual processes are necessary, it can lead to mistakes and delays. And as maintenance costs use up more and more of the budgets, tools struggling to keep up with evolving trends to volumes and regulations hold you back. 

Upgrading to a modern post trade system isn’t just about fixing existing inefficiencies - it’s about unlocking your firm’s potential. The risk of being left behind by competitors is too great and can erode client trust. Instead, why not offer a faster, more efficient, and reliable service than them?

Advanced technology like automation, blockchain, and AI can transform your operations, help your business save money, reduce risks, and scale easily and as required. Modern post trade systems are designed to let you focus on what matters most: delivering an exceptional client experience and staying ahead in a rapidly growing market. 

We aim to help guide you through some of the main challenges faced when using legacy systems in the face of more modern alternatives, the benefits of modernising your existing technology infrastructure, and ways we will help you make a smooth, uninterrupted upgrade.

During our conversations with clients, we see more and more that many are facing similar challenges. While their existing post trade systems served their purpose in the past, today, they create more problems than they solve. 

Precision and speed are essential in our industry, and these outdated platforms are making it more difficult for trading firms to be competitive, let alone grow their market share.

Problems with slow and inefficient operations 

One of the biggest problems we see is working with inefficient operations. Needing any manual processes can down your work, increase the risk of unforced errors, and frustrate your clients. If done manually, even reconciling trades or generating reports can become administratively heavy bottlenecks.

Ongoing maintenance costs 

The cost of maintaining legacy systems is a major and avoidable burden. Updates can be expensive, customisations increasingly complex, and older infrastructure often requires specialised expertise which pushes up costs better spent on investing in growing your business.

Increased compliance risk

Financial regulations are continually evolving (just think of MiFID II) and older platforms struggle to adapt. This could mean leaving your firm exposed to fines or reputational risks. Staying compliant shouldn’t feel like a constant uphill struggle. Having a post trade system that supports you is vital. 

An inability to scale 

Lastly, there are concerns about the scalability of legacy systems. Outdated post trade platforms weren’t designed for today’s much higher trading volumes and complexity of asset classes. As your business grows, these limitations could create barriers that halt opportunities or leave you vulnerable to industry-wide disruptions.

Legacy systems aren’t just outdated—they could be holding your business back. If your teams are forced to spend hours on manual processes, you could be achieving more speed and happier clients with more modern solutions.

Inefficient post trade systems don’t just create operational headaches - they can drain resources, impact client relationships, and hurt your bottom line. Below we assess 3 of the biggest business impacts:

Mounting financial costs

Losing money is often the most direct result of relying on outdated systems. Manual errors and settlement failures can lead to penalties, while the need for frequent maintenance costs and costly customisations puts pressure on operational budgets. Research from Atera also concluded that “up to 80% of companies’ IT budgets” are spent simply on keeping old systems functioning. 

Losing out on efficiency gains

Slower operations, a higher risk of errors, and a reliance on IT teams negatively affect your post trade workflows. In fact, according to Gartner, companies using outdated IT experience a drop in efficiency of up to 25% - and this in turn leads to higher operational costs, slower response times, and more employee frustration.

Reputational risks

The trust and goodwill of your clients could become another casualty. In such a highly competitive space, delays and errors in post trade processes lead to difficult client relationships and more time spent on appeasement than growing their account. If your competitors are offering a faster, more reliable service, your outdated system could be risking your reputation.

While every trade needs to be cleared, settled, and accurately reported, trading firms using ageing technology mean each phase has the potential to introduce unwanted delays, avoidable risks, and evermore inefficiencies. Your post trade process should run like clockwork, here’s where you may be falling short. 

Clearing delays and errors are costly

Clearing ensures that the details of each trade between counterparties match. The problem is that legacy systems rely heavily on manual processing, which leads to mistakes. If your firm is handling high trade volumes or complex asset classes, these are inefficiencies that are creating bottlenecks in your business and wasting time and money.

Settlement with outdated infrastructure increases risks

Settlement is where precision matters most. Legacy systems can struggle to meet modern demands like T+1 settlement cycles, which in turn increases the risk of failures. Missed deadlines or incorrect settlements can lead to financial penalties and damage trust and relationships.

Reporting and the hidden danger of inconsistent data

Accurate reporting is essential for regulatory compliance but is also an area where legacy systems fall short. Without the flexibility to generate customised reports or an uphill climb to rebuild trust with clients and regulators.

Upgrading your post trade process isn’t only focused on replacing outdated systems, it’s also about powering your business to smarter operations, being able to scale faster, and delivering better results for your clients. 

Buy more time with automation

By eliminating repetitive, manual tasks like reconciliation or transaction reporting, you’ll free up your teams to focus on far higher-value tasks and activities. It’ll also reduce errors, speed up workflows, and ensure accuracy - even at peak trading periods.

Build trust with blockchain and DLT

Blockchain and DLT (distributed ledger technology) are now used extensively in financial services because they are demonstrably the most secure way to manage your post trade operations. Real-time data sharing and a ‘single source of truth’ can streamline every step of clearing and settlement, while enhancing transparency and enabling better, faster regulatory reporting.

Solve issues using AI and machine learning

Artificial intelligence can analyse huge amounts of data with the ability to detect patterns, predict and highlight risks, and make recommendations for solving issues before they arise. It’s a proactive instead of reactive approach that can improve compliance, minimise hassles, and give your clients more peace of mind.

Scale with cloud-based solutions

Cloud-based platforms can quickly adapt to growing trade volumes or changing market conditions. Their reduced infrastructure costs also promise higher security, and ensure your systems are efficient, scalable, and protected.

Upgrading to a modern post trade process is above all an opportunity to deliver exceptional client experiences, build trust, and maintain a competitive edge.

Are you feeling hesitant about upgrading your system because of the potential complexity and cost? You’re not alone but transitioning to a modern, technology-driven solution doesn’t have to be a pain. With the right approach and a trusted partner in place, the process can be iterative, efficient, and seamless. Here’s our step-by-step guide to help you modernise your post trade operations:

Assess your situation

We need to start with an audit of your current system to shine a light on your existing inefficiencies and potential risks from your legacy systems. By identifying bottlenecks, manual tasks and processes, and any gaps in compliance, you will get a clear idea of places we can focus on for improvements.

Define your priorities

By focusing on the areas that will deliver the biggest impacts first, whether automating manual tasks, improving reporting accuracy, or scaling for higher trade volumes you’ll start seeing the benefits of updating processes faster.

Choose a partner you can trust

The prerequisites for choosing the right technology implementation partner are a proven track record, flexible solutions, and strong support. A good partner will also act as your guide every step of the way, making sure it’s a smooth and error-free adoption. It’s vital to make the right choice here. 

Start small, scale fast

Try to avoid doing a full system overhaul all at once. Instead, we prefer to implement upgrades and system modernisations in phases, starting with the most critical areas first. By taking this approach we can minimise any potential disruption and give you the chance to see big results quickly while minimising risks. 

Consistently improve

Advancement doesn’t end with implementation. By making iterations to continuously monitor and optimise your processes your trading firm can stay agile, efficient, and adaptable to future challenges.

Legacy systems often fall short when trying to stay ahead of regulatory changes and minimising the operational risks which are critical for today’s trading firms. Modern post trade systems offer a smarter, more proactive approach to regulatory adherence and risk management.

Evolve with regulations

Financial regulations are constantly changing, whether T+1 settlement cycles or digital asset frameworks. Modern systems are therefore built with maximum flexibility in mind, meaning automatic updates to meet evolving requirements without expensive overhauls. 

Simplify audit and reporting

Advanced post trade systems give a real-time view of the most up-to-the-second data and automated reporting tools, making audits faster and easier. Clear, accessible transaction records mean you can respond promptly to requests and strengthen your reputation within the industry.

Manage risks with AI and advanced analytics

Today’s trading systems use AI for anomaly detection and finding discrepancies in trade data. This means having the ability to flag issues before they become a problem. It’s a proactive approach which reduces errors, strengthens operational resilience, and safeguards firms from threats.

Future-proof your operations

With modular architectures and cloud-based capabilities, modern post trade systems are designed to scale and adapt quickly to regulatory changes. This ensures your trading operations remain compliant, efficient, and prepared for the future.

By modernising your post trade systems you’ll get the confidence and stability you need to navigate the complex regulatory environment while fostering growth and innovation.

Post trade processes are always changing and improving, whether that’s driven by new technologies, evolving regulations, or growing client demands for different products and services. Here are some of the trends we think trading firms should be aware of to future-proof their businesses:

Shifting to T+1 

There is a global movement towards reducing the time between trade execution and settlement. While this minimises counterparty risk, it also demands much faster and more efficient post trade systems. Any trading firm reliant on a legacy system for this will struggle to adapt. 

Integrating ESG into post trade 

Environmental, social, and governance (ESG) is still a growing priority for investors and regulators. Post trade systems that can track and report on ESG metrics automatically are vital for creating efficiency, but also in meeting reporting requirements and appealing to socially conscious clients.

Blockchain and distributed ledger technology

Blockchain has revolutionised post trade processes by enabling the sharing of data in real time, reducing reliance on intermediaries, and improving security measures. Adopting a system with integrated blockchain technology can simplify your clearing, settlement, and regulatory reporting requirements and save you time and money. 

Innovation driven by AI

Predictive analytics, anomaly detection, and automated workflows are being driven by artificial intelligence applications. If you’re able to identify inefficiencies or risks in real time, you’re able to react faster and make better decisions.

Digital assets are coming

Cryptocurrencies, CBDCs, and tokenised securities are continuing to gain traction and momentum all over the world, but post trade systems must be agile enough to adapt. This can include managing custody solutions, integrating new regulatory frameworks, or maximising interoperability between traditional forms of value and emerging forms.

Scale and resilience from the cloud

Cloud-based post trade systems typically boast agility, flexibility, and rapid deployment as part of their appeal which allows firms to quickly adapt to market changes while maintaining robust crisis recovery capabilities.

The question we like to ask is, ‘How much is your legacy post trade system actually costing you?’ You see, your existing systems aren’t just outdated, they’re also holding your business back. Rising maintenance costs, slow manual processes, and exacerbated cyber-threat risk all create barriers to growth or erode client trust.

There’s a smarter, more efficient way to approach it. By embracing new technologies that automate workflows, and provide the security of blockchain, the efficiency of AI, and the flexibility of cloud-based platforms, trading companies can do things faster, with fewer errors, all while adapting to evolving regulatory demands. 

The biggest benefits:

• Automating tasks saves time and prevents mistakes. We can eliminate manual processes and allow your team to focus on higher-value jobs.
• Using cloud technology lowers costs and improves efficiency. We endorse scalable cloud-based systems to reduce maintenance costs and boost the flexibility of your systems and requirements.
• Worry less about compliance and focus on growth. Using more modern solutions means your business can adapt quickly to any new regulations, meaning you don’t have to think about regulatory risk or its consequences. 
• Better client experiences mean more positive outcomes. With faster and more reliable operations your clients will be happier and more satisfied with your offerings. 
• Gain an ‘always on’ readiness for the future. Flexible, more agile technologies mean your firm adapts and benefits from opportunities like T+1 settlement and ESG-driven investments quickly and without fuss. 

Are you ready to revolutionise your trading business? 

At AQXT, we make transitioning to a modern post trade system simple. Our expertise, scalable solutions, and hands-on approach empower your business to work smarter, save money, and stay competitive - without any unnecessary downtime.