Numerix Acquires TFG Financial Systems to Deliver Scalable, Real-Time Risk Platform of the Future
Numerix, the leader in risk technology today announces the acquisition of TFG Financial Systems, the only real-time risk, P&L and position management system in the industry. TFG’s dependency graph capabilities, at the heart of its SaaS risk and portfolio management software and technology framework, will be leveraged to provide core real-time, distributed, event-driven processing capabilities in Numerix Oneview enterprise trading and risk solutions.
“Built on a real-time, distributed, fault tolerant, event-driven calculation framework with dynamic directed graph technology, TFG is a state-of-the-art software built for real-time systems. We’re proud to be adding the highest level of performance for front office real-time scenarios – spanning solutions for automated structured products distribution, trading, risk management and now a robust solution for hedge funds and fixed income market makers,” said Steve O’Hanlon, Chief Executive Officer of Numerix. “Echoing our recent Chartis RiskTech 100® award for demonstrating excellence in strategy, this deal clearly exemplifies how we’ve continued to expand our next generation technology platform. Numerix and TFG are already synonymous with fast, robust and scalable products; in 2017 we are focused on continuing to grow and evolve our world class systems.”
Peyman Mestchian, Managing Director of Chartis Research, adds: “Numerix is already a leader in pricing and quantitative risk analytics. By acquiring TFG’s event-driven buy-side and sell-side platform, it has extended its position, and responded to market demand for cost-reducing architectures that combine hybrid data management, analytics, workflow and visualization.”
Scalable, High-Performance Graph Technology for Real-Time Risk
“A dependency graph is essentially a technology for connecting server systems that speak to each other in an event-driven real-time, efficient way,” said Satyam Kancharla, Chief Product and Strategy Officer of Numerix. “The streaming Directed Acyclic Graph, or DAG technology, triggers modules only if data they depend on changes, maximizing efficiency and throughput. As such, the system can calculate VaR, Greeks and carry out stress testing on a sub-second basis, or price 25,000 interest rate swaps per second in volatile markets.”
Numerix Oneview Asset Management, formerly TFG Complete, provides Numerix with a turnkey SaaS based real-time front-to-back office solution to immediately begin working with a range of new buy-side institutions, including hedge funds who operate global macro style strategies, as well as endowments, pension funds and sovereign wealth funds.
TFG’s graph technology will also be central to future versions of the Numerix Oneview enterprise platform. Underpinning Numerix’s technology architecture, Numerix Oneview will be the only independent provider of real-time trading and risk with a single source of data and analytics for front and middle office risk.
“We conducted considerable due diligence on many firms who have staked the claim to delivering real-time capabilities in the market. It’s been well documented how many financial institutions have tried to develop real-time systems on their own and failed. Meanwhile, closed systems like SecDB have operated around proprietary languages and a legacy data model, and select vendor solutions are content to build out similar shell systems without the maturity of data model and analytics,” said O’Hanlon. “As a state-of-the-art trading and risk system utilizing a dynamic dependency graph, Numerix Oneview is the next generation SecDB. Built utilizing standardized components like Python and a modern market standard data model, Numerix is providing technology akin to what firms like Goldman Sachs and JP Morgan are providing while remaining independent and unbiased.”
“TFG has made significant inroads into the hedge fund and banking space, gaining several new clients globally in the last 12 months. With an established track record and strong brand reputation, Numerix will allow us to take our solutions to a more diverse client base and be leveraged to address a wider range of market needs,” said Barry Fenwick, Chief Executive Officer of TFG. “TFG personnel bring decades’ worth of market knowledge across risk management, development and performance technologies. The deep practical knowledge, experience and IT understanding of our joined staff will give us unique insight into recognizing opportunity for our clients. We’re proud to be part of the global leader in risk technology, and the role we’ll have in the future of Numerix Oneview.”
TFG has built a method to value options with a non-standard pay-out function and Knock-Out barriers. As this calculation is integrated into a real-time system, performance and stability are critical. This has been achieved by using implicit finite differences where more detailed grids are used when the estimate of the error exceeds the required tolerance.