Alive and Kicking: STAC Mid-Winter Meeting

At eighty-six years of age and representing an inherently conservative industry, it wouldn’t be at all surprising to anyone if the Security Traders Association presented a conference that was long on boring topics and short on vision. That’s what made the annual STAC Mid-Winter Meeting (MWM) all the more refreshing as cutting-edge topics as diverse as cannabis, women in finance, cryptoassets and ESG took center stage. Here are some of the highlights from the first day of the event.

Cannabis

The cannabis market may be growing dramatically but it is still relatively small and is a long, long way away from mainstream adoption. Still, the trend is clearly tilted toward acceptance and growth so it is only a matter of time until widespread adoption is assured. The composition of the panel featured capital markets veterans who are now pioneers in the field, including moderator Mark D’Souza, Jay Caauwe and Terry Patton, along with Illinois state representative Kelly Cassidy and Michael Piermont . Interesting observations included:

• From an investment perspective, cannabis is “The Roaring 20’s 2.0” — Patton
• Cannabis is a “disruptive technology” with potentially powerful socioeconomic impacts — Caauwe
• The “next greatest cash crop in the world” — D’Souza
• The industry isn’t in its infancy, it’s in “the terrible twos” — Cassidy

Women in Finance

Just as we will hopefully see a future in which cannabis has widespread acceptance, so too will it be nice when we get to a point in history that it is no longer necessary to have a separate panel that focuses solely on women. Unfortunately, that is going to take some time. Patty Schuler of BOX led the discussion as Angela Lucas of Simplex / Matrix, Lauren Rauch from CTC, Itiviti’s Leal Wakefield and Angela Zotos from E&Y related personal tales of career hurdles and professional success. All of these women are incredibly accomplished but the issues at hand were best illustrated by a story from Wakefield. She asked her 12 year old daughter and her friends if they had experienced times in school when they weren’t taken seriously because of their gender and they responded “yes”. Old habits die hard.

OCC Fireside Chat

The OCC isn’t nearly as old as STA but it most ways it is in the same category: conservative and just a bit stuffy. However, just like the MWM, OCC has a few tricks up its sleeve and Pat Hickey, the recent hire as head of business development, brought a fresh approach to his role and detailed some of the ways that OCC is transforming the way that they do business. In conversation with STA President and CEO Jim Toes, Hickey described a listening tour that is leading to a greater degree of transparency and a move to look at customers holistically. He also reiterated the three pillars of the Renaissance initiative — clearing and settlement, risk and data — as well as what’s ahead (strike price proliferation is high on the list). Toes himself relayed how he always thought that clearing was easy and boring when he was on the buyside but learned differently when he to the clearing side of the business and had many sleepless nights.

ESG and Cryptoassets

The topics of cryptoassets and ESG are connected only by the level of interest that they garner but at this point in this note I can’t use too many more words lest I lose my readers.Crypto is somewhere just out in front of cannabis when it comes to relevance for a traditional STA crowd: it’s small now but pretty much everyone knows that the impacts will be felt soon. The crypto panel had a great balance between trading (Brad Koeppen from CMT), exchanges (Matt Trudeau of ErisX), services (Tony Saliba from Matrix / Mercury Digital Assets) and custody (PrimeTrust’s Sean Ristau). In short, every one of these gentlemen is busy but no one is totally killing it at this point. Stay tuned.

Things are a little more interesting on the ESG front, particularly with the recent news from BlackRock CEO Larry Fink that they giant firm is shifting their investment focus to account for climate change. As with cannabis and crypto, however, more evolution is needed before changes can be fully realized. However, it’s just a matter of time on all three counts.

Kudos to STAC

It’s not easy to host a conference for the securities industry professionals, particularly in Chicago in the middle of winter, but STAC does an excellent job of both keeping the content fresh and including new voices in the conversation. That effort makes the MWM a bright spot during a dark time on the calendar.