Dealer-to-dealer electronic trading platform for fixed income markets
In collaboration with Openfin.
After numerous conversations with its own clients, a Nasdaq-listed, leading derivatives marketplace that provides trading platforms for fixed income markets realized that there was an acute need for a comprehensive request for quote (RFQ) trading solution in the Repo segment of the bond market -- an area that has been historically underserved by technology providers.
However, the firm faced two key challenges with respect to realizing its vision:
Building a real-time workflow for a slow-moving market
Delivery at the speed of innovation
There are a lot of generic platforms out there. By leveraging OpenFin and our own Hydra Platform, we were able to rapidly build a solution that specifically caters to the complexities of the Repo space. Our client now has a truly differentiated offering that allows traders to carry out complex RFQ processes with ease and efficiency, which will accelerate the ongoing sophistication of this exciting sector.
MTS BondsPro is a fixed income electronic trading platform focused on enabling access to corporate bond trading. It provides liquidity and real-time execution via an anonymous, all-to-all order book with over 500 participants. The existing user interface (UI) was web-based, built using legacy technology. It provided users the means to participate in its marketplace in a cost-effective and comprehensive platform.
The MTS BondsPro software had rich content and numerous useful features built-in over many years. However, as often happens over the life of a software product, the UI became challenging to support and enhance. MTS made a decision to refresh the user experience and implement a more modern, supportable, and extensible software solution which could also provide a more intuitive user experience for a growing client base. There were tight timelines and lots of enthusiasm to deliver a fresh, modern UI for existing and new users.
It became a recurring joke that we never had comments after Sprint demos, because there were no surprises - Adaptive delivered exactly what we had discussed in the prior weeks, largely bug-free, with a design exactly like the mock-ups.
ErisX was launched in late 2018 to attract institutional participants. However, their existing platform for trading spot products could not support their futures trading plans. Additionally, developing and incorporating new features for spot trading was a slow process that required prioritization of the platform’s development assets. That meant that they needed to deploy a new matching engine as well as a clearing and settlement platform to meet all their requirements. ErisX had a goal to launch the new futures market by year end.
The choice to build was not a trivial decision. Initially, ErisX planned to buy an existing matching engine, but they had unique requirements that the existing platforms either didn’t support out of the box or couldn’t support architecturally.
We were very fortunate to find Adaptive, because they have the subject matter expertise, the ability to bootstrap the project and bring in accelerators like the Hydra Platform, and work closely with our team.
Electronic Trading with a Personal Touch: A Journey with NatWest and Symphony
Delivering all the benefits of an electronic trading platform with full MiFID II compliance, while providing clients with the advantages of high-touch voice trading.
Truthfully, we all knew Adaptive were key to mobilising this project. I knew Adaptive had good recent exposure to the technologies, standards and process challenges that this project involved. They move incredibly fast, and they have deep knowledge of all the cutting-edge frameworks we need. They’re also heavily involved and highly collaborative in the technology forums around FDC3, OpenFin and Symphony. Frankly, if you’re trying to mobilise something quickly on those frameworks, it’s just common sense that you’d want to go with people who’ve used them before, and who aren’t learning from scratch.
Matthew Harvey, Head of FI Client Execution Platforms and Digital Sales, NatWest Markets
The coming of MiFID II brought seismic changes to the fixed income markets. It presented serious challenges to traditionally voice traded business, and caused an immediate shift of order flow to electronic markets - and with future changes like higher size thresholds incoming, that trend was set to accelerate.
But NatWest Markets also knew its clients appreciated the personal attention, bespoke services, trade ideas and insight provided by contact with real people. They needed a way to create a hybrid between voice and electronic trading, where they could leverage the benefits of automation while preserving deep relationships with their clients. Their aim was for a client to be able to request levels, work with RFQs, and execute—all through seamless automation—without giving up the personal touch of a dedicated salesperson. NatWest called this innovative hybrid “digital voice”.
They selected Adaptive to build this new system, which they named Scout, because they knew Adaptive has a good track record of delivering client-facing solutions in FICC. In addition, Julien Dugat of NatWest Markets explains, “Adaptive’s delivery is UX-driven, which has been a tremendous contributor to the high quality of the delivered product. Their focus on quick, iterative delivery means that we can show real momentum, and the result is going to really differentiate us in the market.”
Agricultural Commodities: Trading, Risk Management and Logistics (CTRM)
Adaptive was engaged by a world-class agri-business corporation, with operations spanning the globe, including both domestic and international trade. The client’s business spanned a number of functions, including trade capture and pricing in the front office, physical delivery, fee management, and back office. These global activities were managed in several distinct applications, each with extensive local customizations; this formed a serious barrier to calculating firmwide risk, or generating real-time P&L. Additionally, those legacy applications were inefficient, did not scale, and carried significant operational risk.
To address these challenges, Adaptive has been implementing a Commodity Management, encompassing CTRM (Commodity Trading and Risk Management) and Logistics functionality, system that delivers the following value for this client:
A unified platform supporting common business practices globally.
Increased visibility of firmwide risk, and real-time P&L
More transparent data for senior management of the profitability (or otherwise) of specific centres of activity.
Metrics that support the growth of the business by acquisition.
An efficient, scalable, platform, with much reduced operational risk.
Dramatic reduction in the likelihood and impact of regulatory issues.
Multi-asset: Voice and Electronic Sales-Trader Workflow
Sentinel was a challenging and highly critical strategic project for us, and failure was not an option. Within a very tight timeframe, Adaptive specified and built a fully featured MiFID II compliant trading platform, using a modern technology stack. The project was delivered on time and in budget, and with Adaptive’s help it was fully integrated with our internal systems. Most importantly, on day one the system was live, across all desks, with no outages. I wouldn't hesitate to engage Adaptive again, and would highly recommend them for the most challenging large-scale build projects.
HEAD OF REGULATORY TECHNOLOGY, MAJOR EUROPEAN INVESTMENT BANK
MiFID II brought both operational and technology challenges, and the cost of building new platforms to comply with the new legislation was high. To meet these challenges, a group of banks formed a consortium to fund the development of a new platform. The platform’s aims were to mutualize the cost of compliance, provide a consistent interpretation of the regulation, articulate a clear compliance plan to regulators, and create a future-proof and extensible technology with an open architecture.
Following an RFI, Adaptive was selected from a field of forty companies to manage the requirement gathering process, design and build the front-end, and develop the real-time components. The timescale was ambitious; just nine months to specify and build a modularized e-trading platform supporting more than a hundred asset classes, electronifying the trading of huge tranches of traditionally voice-traded instruments. The platform was built around a configurable data model, and incorporated a sales-trader workflow, regulatory rules engine, and a reporting engine integrated with Google analytics.
Sentinel was successfully delivered – on time, and on budget. The project turned a regulatory burden into a competitive advantage, and the powerful analytical tools continue to enable new market insights for both salespeople and traders.
A tier 1 investment bank needed a page one rewrite of their US treasuries trading platform. The existing application had significant challenges; most notably, the architecture could not support complex trades, was not mobile-ready, and all computation was done client-side. The project needed to be delivered to production within an aggressive six months timeline, aiming to deliver:
Flexibility: the architecture had to support complex instrument packages, including user-definable multi-leg configurations
Integration: the platform needed to support several integration points, notably an OMS
Real time: the solution needed to show real time prices, globally, with a scalable architecture
Efficiency: the system must be fast, lightweight, and have a minimal footprint on the user’s desktop
Adaptive was selected by the client for our technical expertise, and our proven ability to deliver complex platforms within aggressive timelines.
A leading European energy provider was directly engaging with their clients via voice-trading. They wanted to be the first gas and power provider in the country to enable their clients to view and trade on firm prices over the web.
Adaptive took care of all the aspects of the delivery, including business analysis, architecture and technical design, user experience, visual design, the user interface, back-end development, testing and integration.
The resulting e-trading platform gives their clients access to 24/7 liquidity, significantly reduces their cost to accessing the markets, and lowers operational costs and risks by automating post-trade processes. When the clients hit a price, the platform handles all the trade acceptance logic, including the integration with the central credit check systems and places a fill-or-kill order. Moreover, the platform is easily extensible, has a resilient back-end, is cloud-hosted and has a two-factor authentication with password change and reset workflows.
FX Structured Products: Single Dealer Platform (SDP)
A tier one bank saw a business opportunity within FX structured products, and wanted to offer a new service on its e-commerce platform. The project was functionally complex, required multiple integration points, and had extremely aggressive timelines.
With a team of only four consultants, Adaptive delivered to production within just four months. The solution was fully integrated with the bank’s internal frameworks and vendor products, and its features included date calculation services, credit check systems, and pricing engines. The back-end systems were highly resilient, and a flexible and intuitive user interface enabled the bank to calibrate behaviour to the needs of a range of users.
A key factor for the successful delivery was that each consultant on this project had deep experience with similar functional and technical architectures. As a result, the bank benefited from clean modelling of the problem, and getting it right first time without the need for technical spikes. Adaptive directly supported the application and trained the bank’s global support team until the application was handed over to the bank. A tier 1 bank saw a business opportunity within FX structured products, and wanted to offer a new service on its e-commerce platform. Success hinged on delivering rapidly, before trading peaked at the start of the year. Added to this quick time-to-market delivery requirement, the project was functionally complex and needed multiple integration points with existing systems.
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