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April 15, 2011

Hedge Fund in a Box

By Peter Chapman

Trading shops looking to quickly deploy high-frequency trading strategies have a new ally. Rickard & Winans, a Chicago start-up, has built a combination order management/trading infrastructure platform for high-frequency traders. The system allows hedge funds or broker-dealers to integrate their trading strategies into an all-in-one platform that itself plugs into the markets. And while there are other vendors offering similar services - such as Portware or Ften - Rickard & Winans claim a distinction that, execs there say, improves performance.

"The framework involves putting our algorithm into their code," R&W partner Greg Rickard explained. The system known as T1CK3R, does away with the application programming interface and requires the trader to integrate his strategy directly with T1CK3R's algorithms. By doing away with the API, the trader gets a huge boost in speed, according to Rickard, but it does require the trader to make an equally large leap of faith. He must divulge his trading strategy to Rickard & Winans. "They have to expose the elements in their predictive model," Rickard said. "For speed purposes they need to take that leap." The vendor does sign a non-disclosure agreement with the trading house, Rickard noted.

Behind R&W are Greg Rickard, a former business analyst in Goldman Sachs' Rediplus group, and John Winans, a senior systems architect at Argon National Laboratories. The all-encompassing T1CK3R platforms includes such infrastructure elements as feed handlers, middleware, order management, FIX gateways, algorithms, and pre-trade risk checking.

 

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