JC: Your team are experts in both trading and engineering. How have you leveraged that expertise and first-hand experience of life on the desk in helping you to conceive and build the Ideal solution for optimising performance?
Our team led trading and quant groups at proprietary trading firms, banks, and ECNs. We’ve sat in the same seats as the clients we serve, so we understand their needs and know the domain details. We start by building the systems we wanted in those roles and then constantly iterate using insightful client feedback.
JC: Please tell us a little about Ideal’s services and clients.
We serve clients of all sizes, including some of the largest firms in finance. Some firms use us for a single asset class and others utilize us across many desks. Clients need turnkey services: they hand us raw data and we provide a suite of analytics 24/7. We provide client reporting, liquidity management, operational risk, pre-trade, and TCA for financial institutions. While there are specialized firms operating in those categories, we are the only company to bring all those into a unified service.
Ideal analytics are used across our clients’ organizations by:
- Managers to view their business KPIs in real-time.
- Liquidity Managers to monitor the quality of flow in streaming pools and make changes to matching relationships.
- Relationship Managers to address client questions with automated reporting and one-off, complex analysis.
- Ops Risk teams to identify potential system issues.
JC: What asset classes do you support?
Ideal started in FX and expanded into other asset classes including crypto, US rates and credit, often as the first in that asset class. This year we’re expanding into global credit/rates. Traders in each asset class have their own language and nuance. Our core platform gives us a great base that we tailor to the specifics of each asset class in partnership with clients.
JC: Please give us some examples of the benefits that FX trading firms are getting from utilising your solutions.
We can identify the root causes of changes in profitability ($/M or bps/$M) and liquidity so trading firms can tune their systems to meet their goals each day. For one sell-side firm, we identified a software release that reduced their profitability. For a buy-side firm, we quantify algo performance and the value of the flow to their LPs, enabling them to have continuous discussions with their LPs about their expectations on pricing. For an ECN, we identified operational issues with a client sending short-lived orders.
The key value is efficiency and transparency. We deliver quant and tech team capabilities at a fraction of the cost. We boost productivity for clients with in-house quants as we take care of all the data maintenance, freeing up their time for more strategic work.
JC: Ideal also operationalises trading best practices and principles-based regulation as quantifiable checks, curated alerts, and clear action steps. How have risk managers responded to this powerful capability?
For risk managers, the win is getting answers quickly from a single system. They’ve historically had to piece together a single response from different systems owned by different groups, Having a third-party like Ideal do an independent evaluation gives clients confidence in audits that they’re not grading their own homework and cherry-picking the results. Ideal’s cross-asset experience helps clients prepare for how different markets will evolve from a regulatory and compliance perspective so they’re ahead of the curve.
WB: Please tell us more about the key features and functionality of the Ideal business intelligence platform.
Ideal is built to complement the execution infrastructure that the client already has and provide larger scale insights that don’t exist in other systems. A big piece of that is the ability to summarize partial data intraday and revise it as more complete data becomes available. Clients need to know the best estimate of what’s going on in real-time and how that relates to the market and the past so that they can adapt. They don’t have the luxury of waiting for end of month reporting to course correct.
Interactive investigation is a critical differentiator of the Ideal platform. Clients want to be able to answer questions efficiently without relying on quant or tech teams to summarize data or put together a report. Ideal’s UI allows the user to pull together the details and export or share the results in a professional way– no more screen grabbing and combining with reformatted Excel tables.
WB: How do you go about achieving seamless integration of your platform with existing systems?
A big piece of the value we provide is having Ideal manage data from different sources and make sure it is up-to-date and correct at all times. We have seen data in every form there is; from highly structured data to opaque binary formats with no documentation. We meet the client where they are data wise. We can normalize a client’s data and onboard them quickly, sometimes within days.
A big piece of the value we provide is having Ideal manage data from different sources and make sure it is up-to-date and correct at all times
WB: Gathering and managing data has always been a problem in FX. How do you overcome many of the challenges involved with this to deliver your solutions?
Flexibility on data sources and calculations is key. We provide a library of standard calculations and third-party data that we are able to customize for an individual client. For example, for reference prices, we recognized early on that firms want different references, e.g. for skew vs non-skewed mid calculations. Our platform works with all of these references and clients can change options over time as their needs change.
Another important requirement is data privacy. We keep each client’s data segregated and have proprietary controls to further secure their sensitive data. Clients can feel confident that their data will not be aggregated or externalized in any way. Their data is their data.
JC: What’s coming next for Ideal in terms of expanding the firm’s client base and product mix?
Clients are taking us into global fixed income this year, which is exciting. We’re the first in mortgages, EU/APAC rates, and other asset classes. AI has a lot of potential for trading. We’re using LLMs to streamline workflows, reducing one-off research in spreadsheets for clients and LPs.
The explanatory capabilities of modern models will bring insights and save people time, as long as firms can use these tools while keeping their data private. We’re very excited about the new features coming out this year!