I have to say that in some ways it hasn’t changed at all; first and foremost, our role is to understand the objective of the investment strategy we are trading for and ensure the algo strategy we pick matches that objective. That won’t shift. We do, however, have to stay abreast of and adapt to developments in the marketplace, for example, the steady growth of closing auction volumes and close facilities. On the latter, we work really closely with our brokers to adapt our algo strategies to benefit from those changes, where possible through strict A/B experimentation. 

At Man Group we have invested in our experimentation framework over recent years, which has improved both our ability and capacity to explore and optimise through experimentation. What has also evolved is the maturity of our execution analytics platform, which means we can more effectively monitor and analyse key execution metrics – it enables better, faster and more in-depth work. We think this leads us to faster insights and, ultimately, a stronger partnership with our portfolio managers who can also access and consume the same analytics. Given the significant market volatility over the past couple of years, we think the ability to have good and trustworthy analytics is imperative.

What metrics do you use to monitor algos and broker selection on algo wheels?

We use machine learning, and specifically reinforcement learning, to optimally route flow to broker algos within what we call panels (what others might refer to as algo wheels). We think there are multiple benefits to this model: it is a systematic process and devoid of human bias; it offers a statistical framework to balance exploration and exploitation (because panels allocation doesn’t get stale); it’s complementary to experimentation, and finally, it offers a clear incentive for brokers to improve.

How do you normalise your data to ensure you’re comparing apples to apples?

The ability to fairly access execution outcome is extremely important and we spend a lot of time and effort on this. Specifically, there are a few areas where we focus: firstly, where possible we construct panels which have a similar order flow, whether in terms of order characteristics, alpha signature or both, as a way to maximise homogeneity. We also use automation and probabilistic routing to minimise biases, and transaction cost (TC) models that factor in the key drivers of cost. Where appropriate, we also use simulation techniques to reduce noise. Finally, a combination of statistical analysis, segment analysis and trend analysis is utilised to look at execution through different angles.

How much of your algo development and execution analytics do you outsource?

We do both proprietary algo development and execution analytics in-house and that choice has been made for a few reasons. With regard to algo development, firstly we think the information we have on our alphas and strategies gives us an edge when we’re planning the optimal path and approach to execution. Another key factor here is that we can control the pace and focus of development, and finally, being actively involved in the process and deep into the details has improved our team’s DNA and understanding of markets. The same applies for execution analytics – we’re aiming for a best-in-class platform, so every component needs to shine. What we’ve built is best placed to service the diversified business of Man Group.

The post Antish Manna: Leveraging algo strategies to ensure the best outcomes appeared first on The TRADE.

UK-based fixed income investment banking boutique KNG Securities appointed LATAM specialist Chrisitian Laloe as head of debt capital markets and special situations in Latin America. He joined from Globex Advisory, where he advised Brazilian corporates on solutions to optimise their capital structure. Earlier in his career, Laloe served within BTC Pactual’s proprietary trading desk. According to the boutique bank, Laloe’s experience in the LATAM region will be important for the firm’s growth and its strategy to expand in emerging markets.

Man Group’s current chief executive officer Luke Ellis has announced his retirement, with Robyn Grew set to replace him effective from 1 September 2023. Grew currently serves as president of Man Group and a member of the senior executive committee, based in the US. She has spent the last 14 years at Man Group, having previously managed the solutions business, overseen trading and execution, alongside serving as group chief operating officer, head of ESA and general counsel. Before joining Man Group, Grew held senior positions at investment banks Barclays Capital and Lehman Brothers, as well as at LIFFE which has since been renamed as ICE Futures Europe. As part of the new role, Grew will relocate to the UK while still continuing to spend a large proportion of her time in the US, given the firm’s presence there. Ellis will continue to serve as chief executive and remain an executive director of Man Group until 1 September 2023 to allow for an orderly transition and oversight of the firm’s 2023 interim results.

Mediobanca appointed Mario Crovato as its new co-head of fixed income sales. Crovato joined the bank from UniCredit, where he spent the last nine years. Most recently, he served as head of markets for the UK, US and Asia – after previously serving as co-head of markets for the same regions. Elsewhere in his tenure at UniCredit, Crovato spent two years as head of markets US, based in New York. Prior to that, he was global head of rates sales, based in Milan. Crovato initially joined UniCredit as managing director, head of fixed income and credit sales for Italy. Before joining UniCredit, he spent several years at Barclays, Merrill Lynch, Deutsche Bank and Banca IMI. Earlier in his career, Crovato held fixed income sales positions at Rasfin Sim and Banca Commerciale Italiana.

The post People Moves Monday: Updates from the trading desk appeared first on The TRADE.

Grew currently serves as president of Man Group and a member of the senior executive committee, based in the US.

She has spent the last 14 years at Man Group, having previously managed the solutions business, overseen trading and execution, alongside serving as group chief operating officer, head of ESA and general counsel.

Before joining Man Group, Grew held senior positions at investment banks Barclays Capital and Lehman Brothers, as well as at LIFFE which has since been renamed as ICE Futures Europe.

As part of the new role, Grew will relocate to the UK while still continuing to spend a large proportion of her time in the US, given the firm’s presence there.

Ellis will continue to serve as chief executive and remain an executive director of Man Group until 1 September 2023 to allow for an orderly transition and oversight of the firm’s 2023 interim results.

“It is an absolute honour to be taking on the role of CEO at Man Group. Luke has been an incredible ally and mentor to me and I am excited to be able to follow in his footsteps into this new role,” said Grew.

Ellis added: “Robyn is truly exceptional and I know that the firm will continue to go from strength to strength under her leadership and that of the highly talented team around her.”

The post Man Group appoints new CEO as Luke Ellis announces retirement appeared first on The TRADE.

Python-native database, ArcticDB, was built to address the continuously increasing amount of data and complexity of front-office research at Man Group, a challenge that many large buy- and sell-side institutions face.

The agreement is a first-of-its-kind transaction for Man Group and the resulting product will be implemented into Bloomberg’s BQuant offering – an analytics platform for quantitative analysts and data scientists in the financial markets to build, test and deploy models for alpha generation, risk and trading.

The BQuant environment is fully integrated with the Bloomberg Terminal, combining Bloomberg data, services and tools with open-source technology such as Pythin and Jupyter notebooks.

Each year, Man Group trades trillions of dollars of buy and sell orders which demand fast, flexible and familiar data science tools with the ability to store and process complex data at an industrial scale. ArcticDB powers use cases including deep tick history analysis and modelling of large corporate bond universes by dealing with individual data elements spanning millions of rows or thousands of columns.

Through the use of ArcticDB, Man Group’s investment professional and technologists can better power robust, near-real-time automated trading, alongside enabling point-in-time analysis of research datasets and providing functionality for signal backtesting.

Speaking exclusively to The TRADE, Gary Collier, CTO of Man Group Alpha Technology said: “We think ArcticDB could be useful for anyone or any organisation that is carrying out data science in the modern Python data science ecosystem – if data is being processed and insights extracted at scale, it’s a powerful tool to have in the toolbox. Financial data science is a natural starting point for us, given our background, but our view is that opportunities to apply the technology exist across many domains — from bio sciences through to aerospace.”

ArcticDB’s first iteration was made available on an open-source basis via GitHub. The latest version continues an open-source approach while adding a commercial proposition through an enterprise version for production use.

The latest version is designed to leverage modern cloud object storage, complement any existing data science tech stack, and can be installed with a single command.

“We’re excited to collaborate with Man Group to further develop the open source ArcticDB project and to enhance our customers’ experience using the BQuant platform by integrating its capabilities,” said Shawn Edwards, CTO of Bloomberg.

“This will give Bloomberg’s quantitative clients the ability to process, analyse, and backtest using billions of rows of timeseries data in seconds as they seek new ways to generate alpha. In addition, this effort further reinforces Bloomberg’s ‘open-source first’ philosophy, in which our engineers both use and contribute to the broader open-source ecosystem.”

The post Man Group and Bloomberg to bring data and front-office research solution to market appeared first on The TRADE.

Beattie joins CME Group from MSCI, where he served as executive director, APAC, index derivative product specialist, based in Hong Kong. Prior to that, he served at Bank of America Merrill Lynch for close to seven years, most recently as director, head of APAC, futures and options and OTC clearing. He brings a wealth of experience in APAC prime services and listed derivative execution and clearing distribution to the firm and will be based in Singapore.

Alison Hollingshead, Man Group’s chief of staff for its trading platform and core technology has left the firm after almost two decades to join Jupiter Asset Management. The asset manager has appointed her as its new chief operating officer for its investment management division.

Before joining Jupiter, Hollingshead served at Man Group for 18 years in a variety of senior positions across the firm’s trading platform, transformation, equity trading and investment management services. She brings over 20 years’ experience across multiple asset classes, fund structures and jurisdictions to the firm.

Elsewhere, Citi has seen Matt Cousens and Daniel Nehren, two of its most senior London-based electronic equities executives, leave the bank. Cousens and Nehren served as head of platform sales and head of equity e-trading, respectively, and are both reportedly due to leave the bank to pursue alternative opportunities.

Cousens and Nehren both joined Citi from rival bank Barclays, where they served as head of execution sales for Europe, Middle East and Africa and managing director, respectively. The pair’s departures from Citi are not thought to be related.

The post People Moves Monday: Changing faces appeared first on The TRADE.

Alison Hollingshead joins the asset manager as its new chief operating officer for its investment management division after 18 years at Man Group, most recently serving for the last three years as its chief of staff for its trading platform and core technology.

Across her tenure she has operated in a number of roles including head of transformation, head of investment management services, business risk and strategy manager and as an equity trader.

“We are very pleased to welcome Alison Hollingshead as the new Chief Operating Officer (COO) for our Investment Management department.

“Alison is a deeply experienced asset management expert with over 20 years’ experience across multiple asset classes, fund structures and jurisdictions,” Matt Beesley, chief investment officer at Jupiter, told The TRADE.

“I look forward to working closely with her to deliver an investment management infrastructure best suited to supporting our clients’ evolving needs.”

Man Group declined to comment on the move.

The post Man Group trading platform chief of staff departs for Jupiter appeared first on The TRADE.

Man Group has shifted its US equity trade confirmation workflow from the OASYS platform, which DTCC has confirmed will be decommissioned by 31 October this year, to its Institutional Trade Processing Central Trade Manager (CTM) system.

corfinancial said its post-trade processing solution, known as Salerio, provided Man Group with connectivity to DTCC’s CTM platform as the hedge fund managed the transition of its US equities trading activity via OASYS to DTCC’s CTM.

“We wanted to ensure the continuity of our centralised post-trade processing in light of the changes soon being introduced by the DTCC,” said Antonio Dos Santos, head of London investment operations at Man Group. “With Salerio’s rich workflow capabilities, the transition was a simple one and we moved most of our US equity traffic over to the Salerio CTM module with ease.”

Man Group has been a client of corfinancial for several years, adopting its Salerio platform for trade confirmation and settlement for international securities. In 2012, the investment firm went live with SWIFT’s confirmation messaging service and confirmed its first trades with Morgan Stanley via corfinancial’s Salerio.

As part of a multi-strategy to remove redundant and duplicative platforms, DTCC confirmed plans to retire OASYS and support US trades through its CTM system to leverage central matching workflow and settlement notification functionality. The firm added that the move will allow clients to access post-trade confirmation and resolve exceptions from matching through to settlement.

“Our post-trade processing solution is intuitive, making it easy for clients like Man Group to manage their operations with confidence,” added David Veal, senior executive of client solutions at corfinancial. “During 2020, we enhanced Salerio to ensure that it fully encompasses the changes being introduced by the DTCC that allows the processing of both US and international post-trade securities through the CTM service.”

The post Man Group migrates post-trade processing to new DTCC platform with corfinancial appeared first on The TRADE.

Speaking at the ‘Gaining the Edge Hedge Fund Leadership’ conference in New York, representatives from the hedge fund and allocator industry discussed the significant importance the technology will have on investment strategies and processes. 

“AI and machine learning is going to raise the bar across everything. Those that are not paying attention to it now will fall behind,” said one panelist from a $6 billion alternative investment manager, speaking under Chatham House Rules. 

Another panelist from a $4 billion hedge fund agreed, and argued that “every manager has to be looking at it”, while another explained it is beginning to analyse where it can use machine learning for its investment strategies. 

“We are looking at AI across all of our strategies – whether it is for execution, research, capital allocation etc. The technology is something that is very real, but at the same time, it is not a strategy by itself. It depends on how managers use it,” said one senior investment manager. 

The technology is becoming a necessity for hedge funds in order to analyse masses of data, predict corrections in supply and demand imbalances, as well as forecast market movements for tactical asset allocation. 

A recent poll conducted by BarclayHedge found that 56% of hedge fund respondents have used AI or machine learning to inform their investment decisions. Two-thirds also said they use machine learning to generate trading ideas and optimise portfolios. Just over quarter also said they use automation to execute trades. 

One speaker from a global asset manager highlighted that emerging hedge fund managers (sub-$1 billion in AUM), could become specialists in machine learning investing and develop viable systematic strategies. 

However, some of the largest hedge funds are developing machine learning tools or investing in it, including Bridgewater Associates and Man Group. In addition, Renaissance Technologies and Two Sigma have used the technology for investing for a number of years.

JPMorgan Asset Management arm is also planning to invest in emerging and established machine-learning statistical-arbitrage hedge funds. 

The post Hedge funds preparing for the machines to take over appeared first on The TRADE.

UK hedge fund Man Group has confirmed the appointment of former Deutsche Bank chief executive officer, John Cryan, as its new chairman.

The firm said that Cryan, an independent non-executive director of the company, will take on the role of chairman as of 1 January 2020, following Ian Livingstone’s decision to step down from the role after four years.

“I am delighted to be taking on the role of chairman, working closely with the board and the executive management team to guide Man Group through the next phase of its journey,” Cryan commented. “My time on the board has already shown me that the company is well positioned to capitalise on its first-class technology and investment expertise, cementing its position as one of the world’s leading active investment managers.”

Cryan was the CEO of Germany’s Deutsche Bank from July 2016 until April 2018, during a turbulent time for the investment bank following a third consecutive annual loss in 2017, with a pre-tax loss of €1.3 billion for the final quarter of the year. He was replaced by long-serving Deutsche Bank veteran Christian Sewing, who was most recently head of bank’s private and commercial banking.

Man Group CEO, Luke Ellis, also commented that amid Livingstone’s departure and Cryan’s appointment, the strategy for the firm remains unchanged as it continues to strengthen and diversify the business.

“It has been a pleasure to work with Ian since he and the board appointed me as CEO,” Ellis added. “He has a real breadth of corporate experience and his insights have been incredibly valuable to me and the company. We are delighted that John will be taking on the role of chairman. He has already been a great contributor on the board and I look forward to continuing to draw on his extensive experience of the global financial services industry in the years to come.”

The post Former Deutsche Bank chief Cryan appointed chairman of Man Group appeared first on The TRADE.

Speakers taking part in a keynote address at this year’s TradeTech conference outlined how their firms had approached machine learning projects and warned that those expecting immediate results from such endeavours would most likely be disappointed.

Antish Manna, head of execution research at MAN GLG, said that the firm went live with a machine learning-based framework for order flow and broker allocation last year.

“This framework effectively takes away the need for human to set an arbitrary target for ‘my first three brokers are going to get this amount of flow’ and continuously updating that target to having a machine that automatically does that”, Manna explained.

“The beauty of it is that it becomes a very clean conversation with our brokers; they know how we are doing things and that they will get more flow, and this machinery also adapts to changing market conditions.”

Manna explained that although the hype around machine learning has grown to a point where expectations are now becoming unrealistic as to what the technology can achieve, starting with a relatively simple element such as broker allocation means the firm can build out the framework take on more expansive and intuitive projects in future.

Representing the sell-side was Shary Mudassir, co-head of global equities execution at RBC Capital Markets, who agreed that industry perceptions around machine learning were often false, particularly around how long such developments take to complete and the amount of time it can take to build the required expertise.

“There is a perception that you can hire people and have meaningful, AI-based outcomes…it doesn’t work that way. Real success with AI requires very large teams,” he said.

“At RBC, we’ve got in our AI research team over 100 AI scientists. Within the applied AI space we have over 300 data scientists on the bank side. On the equities execution team now for the most recent product we will be rolling out at some point over the year, we have a team of over 60 people, and these 60 people are not all AI scientists – these are sales traders, traders, quants, execution consultants, technologists…they have all come together over that period of time to deliver on one big outcome.”

Addressing those unrealistic expectations, Manna said that the majority of time spent on machine learning projects is used to clean data before research and development can take place, and that those firms that are only now starting their journey with machine learning should be not expect to see results in the short-term.

The post Patience is a virtue when it comes to machine learning say experts appeared first on The TRADE.