First Derivatives (FD) (AIM:FDP.L, ESM:GYQ.I) a leading provider of software and consulting services to the capital markets industry, has won Market Surveillance System of the Year at the Futures and Options World (FOW) Asia awards.
Now in their third year, the FOW Awards recognise the leaders in the derivatives industry in Asia. FD’s product, Delta Surveillance, responds to the need for regulators and exchanges to be as fast and sophisticated as their participants, allowing them to monitor the activity of even high-frequency trading participants in real-time.
Managing Director, Asia, Martin Haines, said the award was a great recognition of the company’s Asian team.
“We have been on a growth journey in Asia over the past two years, and have made some excellent progress such as the implementation of Delta Surveillance by the Australian Securities and Investments Commission (ASIC), as well as Yieldbroker,” he said. “As markets continue to become faster and more complex, surveillance – for regulators, exchanges and participants too – is becoming increasingly important. We’re having more and more conversations about it as it becomes part of the day-to-day requirement of doing business in finance in Asia.”
The FOW judges commented, "In an age where we are under more and more regulatory scrutiny, the Delta Surveillance has allowed for regulators and institutions to maintain a steady balance of knowledge on trading behaviour."
The custom-built system, based on First Derivatives’ Delta Stream™ technology, leverages its existing high performance algorithmic trading infrastructure to allow users to conduct multi-market supervision across multi-asset classes – equities, futures, options, fixed income and OTC – in real time, providing new capabilities in identifying fraud across and between different markets. The speed of the system provides unmatched flexibility of analysis, with the time taken to produce some reports reduced from several hours to less than one minute.
Delta Surveillance is different from traditional surveillance systems in the following ways:
- It includes a full depth of market database (all orders and all trades).
- Innovations for identifying insider trading and market manipulation.
- Developments for enhanced enforcements.
- OTC products for SEF/CTFC compliance.
- Unlimited ability to apply ‘big data’ analytics and data mining, using the fastest available market database, to analyse past behaviour, run historic reports and replay alerts for calibration against any historical time point.
- Historic alert replay leverages the entire market database to review the order book of any instrument at any time in the past, overlaid with ‘entities of interest’ tagged and highlighted to show their presence visually in the market.
- Alerts may be calibrated and benchmarks run to set alert thresholds, such that the alert parameters can then be set in real time with immediate effect in the market
- A simple workflow system allows for alerts to be expediently managed – discarded, explained, marked to watch or researched for further follow up.
- Delta Surveillance has been benchmarked against traditional market data capture implementations and shown similar functions being performed 20 to 100 times faster.
