What Is SQL?
SQL, pronounced "sequel" or "ess-que-el," stands for Structured Query Language. It is a powerful, declarative programming language specifically designed for managing and manipulating relational databases. Within the broader category of data management in finance, SQL serves as the foundational tool for storing, retrieving, updating, and deleting structured data, enabling financial institutions to efficiently handle vast amounts of information, from customer records to complex transaction histories.
History and Origin
The concept behind relational databases was first introduced by Edgar F. Codd, an IBM computer scientist, in a seminal 1970 paper titled "A Relational Model of Data for Large Shared Data Banks."10,9 Following Codd's groundbreaking work, IBM researchers Donald D. Chamberlin and Raymond F. Boyce developed a language initially named SEQUEL (Structured English Query Language) in the early 1970s for IBM's System R, a prototype relational database management system. This language was later renamed SQL due to a trademark conflict.8
The first commercially available implementation of SQL was introduced in 1979 by Relational Software, Inc., which later became Oracle Corporation.7 SQL quickly gained traction, leading to its adoption as a standard by the American National Standards Institute (ANSI) in 1986 and the International Organization for Standardization (ISO) in 1987.,6 This standardization was crucial for ensuring consistency and portability across various database systems, solidifying SQL's position as the dominant language for relational databases.5
Key Takeaways
- SQL (Structured Query Language) is the standard language for interacting with and managing relational databases.
- It allows users to retrieve, insert, update, and delete data, as well as define and modify database structures.
- SQL is crucial for data analytics and reporting in many industries, including finance.
- Despite the emergence of alternative database technologies, SQL remains foundational for structured data warehousing and transactional systems.
- Standardization by ANSI and ISO ensures a high degree of compatibility across different SQL database implementations.
Formula and Calculation
SQL itself is a query language, not a computational formula in the mathematical sense. However, it provides extensive capabilities for performing calculations and aggregations on data stored within databases. These operations are essential for financial modeling and analysis.
For instance, to calculate the sum of transaction amounts or the average portfolio value, SQL uses aggregate functions: