Accelerating the delivery of a real-time compliance system
Enhancing critical checks
Quantitative and systematic hedge funds, which use algorithms to autonomously execute large scale trades, require sophisticated risk and compliance controls to handle high trading volumes and meet regulatory requirements. Having a system that can deliver this seamlessly while automatically enforcing robust risk controls on high trading volumes in a blink of an eye is essential.
Systematica Investments is a leading global quantitative and systematic hedge fund, trading a diverse range of strategies across asset classes. In a highly competitive technology enabled industry, having the most efficient systems and technologies in place is paramount. Systematica therefore devised a strategy to upgrade its technology stack via the rapid delivery of a centralised, low latency risk and compliance system, which would serve as a foundation for the firm’s next generation of trading technology.
Finding the right partner
In early 2020, Systematica initiated a process to find a firm to help it accelerate the delivery of Guardian, its improved centralised real-time compliance system. Following a rigorous procurement process, in July 2020 Adaptive was appointed to work alongside Systematica to deliver the system. Adaptive was selected as a consultancy that would provide a single, consistent team with high-quality software engineering talent and specific experience in building solutions on Aeron technology.
Harnessing the power of Hydra
Adaptive’s Hydra is a proven delivery platform built on Aeron cluster technology. This technology was a vital factor in Sytematica’s decision to appoint Adaptive, as it acted both as the foundation for accelerating the delivery of Guardian and for developing the firm’s next generation of proprietary trading systems.
Hydra complemented Systematica’s existing technology design and architecture, offering a natural evolution of its systems through its clustering and low latency messaging system, as well as offering a perfect foundation and framework to build, test and deploy bespoke applications.
Working with Adaptive
Historically, Systematica had used permanent staff and a small number of contractors to build its technology stack. Partnering with Adaptive represented a change in this approach, with the two firms’ development teams working together in collaboration with Systematica’s investment compliance lead in London.
Moving away from the use of a small number of contractors over short periods of time, Adaptive was a single, consistent point of contact with consistent resourcing which could be scaled up or down. This approach resulted in six to eight additional team members working on Guardian at one time at the peak of the project and allowed Systematica to access broader expertise.
Go-live and taking the relationship forward
Guardian went live in two phases, the first one in April 2021 covering macro trading models, followed by equities in September 2021 – expanding the system to cover all the firm’s trading activities. Guardian has been an important testing ground for Hydra – using the platform as a foundation, the two firms are building on their relationship and are currently working on a project to update Systematica’s OMS.