KX Research Reveals Capital Markets Firms Gain a Six-Month Competitive Edge With AI

33% of AI budgets are spent on unsuccessful data projects, while firms bridging the ‘Quant-IT Divide’ are securing a definitive competitive advantage

NEW YORK--(BUSINESS WIRE)--KX, a global leader in real-time, time-series and AI-driven analytics, today released its latest research, the “KX Capital Markets Data Report 2026: How to Gain the AI Edge” showing that artificial intelligence (AI) boosts productivity by 62% in capital markets, with even greater gains possible. The report surveyed 2,200 quants and IT and data leaders at capital markets firms, analyzed the relationship between these two groups, and outlined a path forward for overcoming adoption hurdles.

The report highlights that large capital markets organizations are investing an average of $104 million annually in AI. However, 33% of this spend is wasted on projects that are cancelled, delayed, or underperform due to fractured data infrastructure. Firms who hinder unification of their data estate will continue to lose ground.

KX’s research underscores the need for stronger quant and IT collaboration and identifies a specific architectural approach adopted by top-performing firms who have moved beyond pilot projects and are achieving a 6-month alpha-edge over competitors. The “AI-Ready Quant Paradigm” outlines a proven approach to reshape alpha generation:

• Unified Time-Indexed Pipelines: Eliminating data silos to feed models instantly.
• Python-First Experimentation: Giving quants the native tools they prefer.
• High-Fidelity Replays and Sandboxes: Enabling rapid, risk-free model validation before production.

“Capital markets operate in an environment where the blink of an eye is too slow and too many firms are stuck in a perpetual AI-pilot mode,” said Nataraj Dasgupta, SVP of AI, KX. “Aligning quants’ and IT leaders’ needs is crucial to building successful systems that will unlock AI’s full potential. At present only 4% of analysts have complete freedom to experiment, but it’s this experimentation that allows firms to gain momentum and build the systems that enable prediction, decision, and action before markets move.”

The following emerged as key findings in the research:

Execution risk due to lack of trust: In the past year, 43% of quants could not trust insights due to incomplete or missing data, 44% missed trading opportunities from execution delays, 40% were unable to act because of data mistrust, and 35% struggled to model risk scenarios accurately. These challenges put firms at increased risk of models that underperform, failures during market shifts, and difficulty interpreting outputs.

Infrastructure friction slows down ROI: While 70% of quants are eager to adopt more technologies, they are prevented from doing so because of security concerns (41%), data quality and readiness issues (40%), excessive costs (37%), compliance and regulatory risks (32%), and governance or ownership challenges (30%). On the other hand, 66% of IT leaders feel “overwhelmed” by the demands analysts place on them, with more than half receiving complaints from analysts for a lack of support, such as not providing new technology fast enough.

Collaboration builds success: Encouragingly, 82% of organizations involve quant teams in AI decisions and IT leaders acknowledge the value of this collaboration. Progress is being made toward a unified approach that empowers quants, strengthens technology decisions, and sets the stage for smarter, faster innovation.

“This research proves that the next wave of competitive advantage won't be won by algorithms alone, but by infrastructure,” said Ashok Reddy, CEO of KX. “When 78% of quants warn that current data strategies will lead to failure, the market is signalling a need for change. The leaders of tomorrow are those bridging the gap between quant agility and IT governance to unlock transformative value.”

To read the full “KX Capital Markets Data Report 2026: How to Gain the AI Edge” report, click here. Learn more about how KX can help unlock AI’s potential here.

Note to editors: Survey of 1,120 Quantitative Analysts across North America, EMEA and APAC and survey of 1,120 CIOs, CDAOs and similar senior IT and data decision makers across North America, EMEA and APAC were performed in summer 2025 by Coleman Parkes Ltd.

About KX

KX software powers real-time, time-series, and AI-driven analytics across capital markets, aerospace & defense, and high-tech manufacturing. Built for speed, precision, and scale, the KX platform enables organizations to extract actionable insights from streaming, sensor, and historical data to support critical use cases from predictive maintenance and operational automation to real-time simulation and vertical agentic AI. Trusted globally for its proven performance and reliability, KX delivers the data infrastructure enterprises need to thrive in an AI-driven world. www.KX.com