Capital Markets Successes
Large global investment banks, hedge funds, and proprietary traders face enormous pressures to quickly understand and react to ‘fire hoses’ of real-time market data streaming into their systems today.
In the real-time environments around algorithmic trading, feed processing and conditioning, pre-trade compliance, and risk management, custom-coded infrastructures are being outpaced by the speed and volume of the data being generated and delivered. Furthermore, ‘point solutions’ for just one type of front-office application often are unable to meet the demanding real-time processing needs of multiple organizations across the firm.
“The implementation of StreamBase allows us to monitor our risk, make routing decisions, and assess the health of our entire U.S. trading operations in real-time."
The StreamBase™ Event Processing Platform is designed to solve these real-time data management problems with a high performance infrastructure for capturing, analyzing, and reacting to streaming market data, at speeds at up to hundreds of thousands of messages/second. With the StreamBase platform, capital markets institutions can build high performance, low-latency applications that process and analyze data as fast as it arrives from multiple markets or exchanges in just days.
Below are examples of the applications and benefits being realized by capital markets firms across the globe for applications including:
Real-Time Monitoring, Analysis, Risk, and Routing
Algorithmic Trading
Market Data Processing and Analytics
Transaction Cost Analysis and Compliance
Market Data Latency Monitoring, Algo Trading, Profit and Loss
Order Management and Monitoring
Real-Time Monitoring, Analysis, Risk, and Routing
BNY ConvergEx Group, LLC, a leading provider of global agency brokerage and investment technology solutions, needed the ability to monitor its entire electronic trading infrastructure, in real-time. This included BNY ConvergEx's dark liquidity pool VortExSM, market interaction monitoring, routing, trading operations analysis, credit risk correlation, system health monitoring and real-time analysis of market feeds for latency and response time. The firm turned to the StreamBase stream processing engine to address this need.
BNY ConvergEx uses StreamBase Studio™, a graphical event flow modeling environment, to rapidly design, test, deploy, and sustain their system. BNY ConvergEx also uses the StreamBase Event Processing engine to apply risk models and latency measurement in real-time. The system monitors latency with multiple electronic trading venues. If one fails to respond with expected latency, StreamBase helps BNY ConvergEx proactively address technical issues, correlate and understand risk profiles, alert trading operations staff and adjust routing decisions for trading.
“The implementation of StreamBase allows us to monitor our risk, make routing decisions, and assess the health of our entire U.S. trading operations in real-time,” said Joseph Weisbord, Managing Director, BNY ConvergEx Group.
“There are three primary reasons StreamBase impresses me," continued Weisbord. “First, time to market is key in financial services, and the StreamBase Studio™ environment allows us to get to market quickly with very little coding. Second, StreamBase meets the high-performance demands of Wall Street – it can handle large amounts of data, quickly. Finally, its multi-threaded architecture makes it very efficient – so StreamBase scales smoothly as the volumes in the market grow – it helps future-proof our trading infrastructure.”
A $700B+ capital markets firm needed to add new features to their algorithmic trading system after key members of the previous team maintaining this infrastructure left the firm. Faced with the need for a more flexible system with new features while lacking the expertise to evolve the proprietary, custom-built system, the firm turned to StreamBase’s Event Processing Platform. The new system built using StreamBase continuously queries multiple market data streams, runs a variety of time-based trading analytics (including VWAP, TWAP and Bollinger bands), breaks large orders into smaller blocks that can be traded with low market impact, determines best execution across multiple liquidity sources based on price and response time, and routes orders to the selected venue. The system has built-in capabilities for back-testing algorithms on historical data, and was deployed in under three months by a 2-person development team.
With nearly half of its employees engaged in research and trading, an institutional money management firm with $150B in global investments was concerned about data feed latency and accuracy of market data. Estimating that quoting and trading data could increase to 124,000 messages per second that year and double again in the subsequent year, the firm needed to modernize its market data infrastructure. The firm chose StreamBase, and implemented a scalable, reliable, and cost-effective error correction application within weeks. A graphical Eclipse-based development environment enabled IT to take advantage of agile development concepts for their pilots and deployed applications. The firm’s traders and technologists could quickly model, test, and deploy solutions utilizing predefined workflows and rules. As a result, the application successfully flagged bad data and immediately eradicated latency by identifying and eliminating empty time intervals in the firm’s primary data feed. The application then automatically inserted those missing values from a second or third data feed. According to the firm’s head of trading technology, “StreamBase is the lifeblood of the trading decisions” executed at the firm, and the platform ultimately helps the organization capture new market opportunities and increase profitability.
Organizations managing the compliance process under a litany of complex regulations are tasked with conducting continuous market surveillance and monitoring of pre-trade data to ensure that regulatory trading polices are being followed. At the same time, with increased market volatility, firms also need to reduce the “slippage,” which is the difference between estimated transaction costs and actual transaction costs. When the amount of market data it needed to process and monitor doubled, a €6B European equity hedge fund chose StreamBase to build a real-time pre-trade analysis application. StreamBase provided end-to-end connectivity and a scalable platform for monitoring large data volumes with near-zero latency, enabling the hedge fund to evaluate broker performance with both real-time and historical data. After implementing StreamBase technology, the firm gained tighter compliance and transparency for pre-IPO activities, while also reducing brokerage fees and slippage due to better execution strategies.
A $6 billion global hedge fund facing a variety of real-time challenges spanning market data, trading, risk management, and profit and loss analysis chose StreamBase as their real-time application development platform. After just a half-day of training, the market data group connected StreamBase to their ticker plant infrastructure and quickly discovered an unacceptable latency in the data from their feed provider. With this information in hand, the company worked with their vendor to immediately have the delivery infrastructure upgraded. The firm also improved its algorithmic trading operation by using StreamBase to apply real-time analytics to pricing 30,000 Nasdaq equity options in real-time—a problem which was previously impractical to solve. This system generates automatic buy/sell signals for the trading applications, now providing the company with a significant competitive edge. In addition, the firm’s infrastructure for tracking P&L and risk in real-time across multiple disparate trading silos was unable to keep pace with the newer high frequency trading strategies, and the team deployed StreamBase within weeks as the foundation for new real-time risk management and portfolio management system to reduce risk and increase trading profitability.
A $1 trillion global investment firm needed to improve their real-time tracking of client securities orders through their distributed global messaging infrastructure. In particular, they needed to be immediately alerted to problems with orders of greater than $500,000 in value that exceeded credit and risk limit levels, had incorrect order states, or did not proceed according to performance specifications. StreamBase was deployed in a matter of weeks with a 2-person development team to continuously query order streams, and instantaneously alert operations staff to problems. The results for the firm include reduced costs of operations and monitoring, and greater profitability of trading operations with lower risk.