Quant Brokers Algo Gets a ‘Leg’ Up
Quantitative Brokers (QB) is trying to get a leg up on the competition.
QB is now offering its latest and premium-billed “Legger” algo on TS, formerly TradingScreen, TradeSmart’s combined order/execution management system.
QB already offers a suite of dealer-neutral agency algorithms in futures and US Cash Treasuries. Legger is the former’s multi-leg spread trading algorithm and part of the firm’s suite of four premium futures and fixed income algorithms. By expanding the Legger offering , QB helps a wider array of buy-side traders to coordinate the execution of multiple order legs to achieve a synthetic price target.
Legger joins QB’s Bolt, Strobe, and Closer to further enhance TradeSmart’s customizable trading capabilities.
In speaking with Traders Magazine, Alastair Hawker, Head of North America Sales at QB, said Legger is aimed at the futures and fixed-income markets. Specifically, Legger can be used to trade approximately 86 futures instruments globally and six on-the-run cash treasury products. For the cash Treasuries, the algo can work for the 2-, 3-,5-, 7- and 10-year notes. It can also execute for the 30-Year bond.
“Legger is a specialized synthetic spread trading algorithm engineered specifically to handle multiple legs for combinations of these instruments” Hawker said.
QB’s Legger can work in trading solely futures contracts, solely within cash Treasuries and split between a futures contract and a cash Treasury instrument – executing what’s commonly referred to as basis trading.
“Our algorithmic execution capabilities for cash Treasuries are at the forefront of market structure evolution for these securities, Legger being one part of it, but also smart order routing to aggregate multiple sources of liquidity.” Hawker said, referring to the need for an algo such as Legger. “This is the alternative to OTC, principally priced execution”.
Legger also incorporates the usage of the latest smart order routing technology and connectivity for both futures and cash Treasuries.
However, as Hawker is quick to point out, Legger is not a new algorithm and has been in service for a few years, but now, as the market has evolved, it has gained usage and is new on the TS platform. It is often tested by clients in QB’s realistic simulation environment before going live, just to help traders practice and get comfortable using it, as multi-leg orders typically require more attention.
“Legger was ahead of its time,” Hawker began. “Complex multi-leg orders have traditionally been handled by voice brokers. Legger offers an advanced alternative, empowering traders to work even the more challenging orders themselves.”
Aim is to improve control and flexibility for advanced trading strategies.
Aim is to minimize leakage via routing and segmentation strategies.
Deal gives CQG customers futures trading strategies without the need to customize.
Traders can now execute order in multiple cybercurrencies alongside stocks.
Broker-dealer algorithms are evaluated, normalized and eventually rewarded for their performance.