Plus moves from Small Cap Equities to Derivatives

Plus Markets provide quote-driven execution for small cap equities. Plus competes with Chi-X and LSE's multi-dealer platforms. Plus is expanding into interest rate swaps which have seen a rise in interest in recent months; there is speculation of a total shift from OTC to on-exchange when financial regulations kick in in the US in June. This has also put pressure on banks to up their single-dealer platforms too. Examples of single-dealer platforms are Deutsche Bank's AutoBahn, Barclay's BARX and Morgan Stanley's Matrix.

Fintech 100: Lemons to Lemonade

FinTech 100. 60% of firms come from North America.

Art Shark Steve Cohen and the SAC Capital Story

Steve Cohen's hedge fund SAC Capital, focused on equity market strategies, is based in Stamford, Connecticut. He owns a 14 acre property in Greenwich - the wealth centre of Connecticut. While at the Wharton school he opened a brokerage account and after school started in options arbitrage at Wall Street firm Gruntal and Co. Cohen founded SAC in 1992 with 9 employees and $25m AuM.

Modern Day Babbage

Charles Babbage was a mathematician who used to build computers or calculating machines. His most famous work was the difference engine. A more recent mathematician who contributed to computer science was Von Neumann who worked on Monte Carlo simulation. He is described as having "fearsome technical prowess" and "scintillating intellect".

Neil Chriss: From 11 Year Old Programmer to Hedge Fund Manager

Chriss went to University of Chicago and majored in mathematics. He was at SAC Capital for a while before founding Hutchin Hill Capital focused on process-driven trading. He is the author of "Black-Scholes and Beyond: Option Pricing Models".

Program Trading: Systematic Alpha Management

Systematic Alpha Management (SAM) is situated on Fifth Avenue New York, set up as an LLC. They specialise in "market-neutral, absolute-return oriented quantitative trading strategies". They have funds:

* Systematic Alpha Futures Fund
* Systematic Alpha Diversified Program (100% trend following)

SAM is registered as both a CPO and a CTA (Commodity Pool Operator and Commodity Trading Advisor, respectively) with the CFTC and NFA respectively. CPOs are defined on the CFTC website (defined as individual or organization that solicits funds for a commodity pool, to invest in futures or options on futures, or in another commodity pool). CPOs must file disclosures electronically using the NFA's DDoc system.

The Barclay CTA index (on BarclayHedge website) tracks performance of CTA funds (more than 500 funds for 2010). Four years of prior performance history is needed for inclusion in the fund.

Gaining an Options Education

There are various websites to gain an operational understanding of options trading. These include The Options Industry Council and the "Options for Rookies" blog (talks a lot about VIX).

Article on Quantitative Hedge Funds from MoneyScience

The venerable magazine MoneyScience (which runs a directory of financial technology) has quotes from a number of people active in the QHF space. One of these is Andrew Lo, founder of AlphaSimplex Group which runs $550m in assets.

Financial Software and Private Equity

A number of finanical software firms are owned by private equity. OpenLink is now part of The Carlyle Group (acquisition: November 2009) - oil trading software provider. Also, Solarc.

Cross Holdings in American Exchanges

BM&FBovespa (an equities and derivatives exchange based in Sao Paulo) is raising its stake in Chicago's CME to 5% (CME already owns 5% of BM&FBovespa). As a result BM&F will sit on CME's board and the two exchanges will marshal a workforce of 150 developers to create a new multi-asset trading platform, with commercial rights in Latin America given to BMFB and CME owning rights to the rest of the world. BM&F used NYSE Euronext Advanced Trading Solutions to help develop its trading platform.

Where is the Buy Side Buying Their Technology?

Check out buysidetechnology.net.

Action in FX Platforms: FXall gobbles up LavaFX from Citi

Global institutional FX platform, FXall, has agreed (Jan4) to purchase LavaFX from Citi. What's so special about LavaFX? LavaFX CEO, Tom San Pietro, joins FXall as Head of Active Trading. LavaFX emphasises FXall's focus on services for "active traders".

Faster Trading System for Tokyo Stock Exchange

TSE launched its new Arrowhead System on Jan4, a faster system which reduces order-processing time from 2 to 3 seconds to 5 milliseconds. Its remit is all cash products including stocks and convertible bonds. The aim is to increase turnover and enable TSE to deal with sudden increases in the number of transactions.