Quantitative Brokers (QB) Company Overview

Founding Date and Background

Quantitative Brokers (QB) was founded in 2008 by Dr. Robert Almgren and Christian Hauff. The inception of the company arose from the founders' recognition of inefficiencies in electronic trading for fixed income commodities and currencies. They aimed to address the gap in technology solutions, quantitative execution, and cost measurement tools that were already prevalent in equity markets.

Parent Company/Ownership Structure

In December 2020, Deutsche Börse completed the acquisition of a majority stake in Quantitative Brokers. Despite this acquisition, the co-founders, Dr. Almgren and Hauff, continue to play pivotal roles in the company, with Almgren serving as Chief Scientist and Hauff as CEO.

Headquarters Location

Quantitative Brokers is headquartered in Midtown Manhattan, New York City, with additional branch offices in London, Sydney, and Chennai.

Global Business Scope

QB operates on a global scale, providing advanced trading algorithms and analytics to clients engaged in futures, options, and interest rate markets. The firm has developed a suite of products designed to reduce implicit trading costs and enhance trading efficiency.

Main Regulatory Bodies

As a registered broker-dealer, Quantitative Brokers is regulated by several key bodies, including the National Futures Association (NFA), the Financial Industry Regulatory Authority (FINRA), the Commodity Futures Trading Commission (CFTC), and the Securities and Exchange Commission (SEC).

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Company History and Development

Key Milestones

Quantitative Brokers officially launched its operations in 2010 after two years of research and development. Since its launch, QB has successfully executed numerous client trades and expanded its algorithmic offerings.

Business Expansion Journey

Over the years, QB has grown its client base significantly, which includes some of the world's largest asset managers, hedge funds, commodity trading advisors (CTAs), and global banks. The firm has also expanded its algorithmic strategies to cover over 20 global exchanges and 130+ contracts.

Customer Base Growth

The company has established a diverse clientele that includes both buy-side and sell-side firms. Its algorithms are integrated with various execution management systems (EMS) and order management systems (OMS), providing a comprehensive trading solution.

Platform Development History

QB has continually innovated its trading platform, launching a suite of seven algorithms that are adaptable to changing market conditions and client feedback. The firm has also developed a highly realistic trading simulator that allows clients to test their strategies without financial risk.

Important Awards or Recognitions Received

Quantitative Brokers has received accolades for its execution analytics and technology, helping clients save hundreds of millions of dollars in transaction costs over the past decade. The company has been recognized for its contributions to algorithmic execution in various industry events.

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Trading Services Offered

Forex Trading Options

Quantitative Brokers does not primarily focus on forex trading; however, it does provide advanced trading algorithms that can be utilized in various markets, including fixed income and futures.

Stock Trading Options

While QB specializes in futures and cash treasury markets, it also offers algorithms that can be applied to stock trading, enhancing execution efficiency for institutional clients.

CFD Trading Products

The company does not explicitly list Contracts for Difference (CFD) as a primary offering; its focus remains on futures, options, and interest rate products.

Other Financial Instruments

Quantitative Brokers provides trading solutions for a range of financial instruments, including:

• Futures: Covering various asset classes.
• Options: Advanced execution strategies for options trading.
• Interest Rate Products: Tailored algorithms for trading government securities.

Special Services or Unique Advantages

One of the standout features of QB is its commitment to transparency and neutrality. As a broker-neutral technology provider, it works with all major executing brokers and integrates seamlessly with numerous EMS/OMS platforms. The firm also offers advanced execution analytics and transaction cost analysis (TCA) tools, providing clients with insights into their trading performance.

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Regulatory and Legal Background

Detailed Regulatory Information

Quantitative Brokers is registered with the following regulatory bodies:

• National Futures Association (NFA)
• Financial Industry Regulatory Authority (FINRA)
• Commodity Futures Trading Commission (CFTC)
• Securities and Exchange Commission (SEC)

Legal Entity Structure by Region

As a global entity, QB operates under various legal frameworks depending on the region, maintaining compliance with local regulations while ensuring that its clients receive the highest standards of service.

Client Fund Protection Measures

QB implements stringent supervision and control practices to protect client funds. As a registered broker-dealer, it adheres to the regulatory requirements set forth by the aforementioned bodies, ensuring that client assets are safeguarded.

Countries/Regions Served

Quantitative Brokers serves clients globally, with a particular focus on major financial markets in the United States, Europe, and Asia-Pacific regions.

Compliance History

The firm has maintained a strong compliance record, adhering to the regulations set forth by its governing bodies. Its commitment to transparency and neutrality has earned it a reputation as a trusted partner in the financial technology space.

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Competitive Landscape

3-5 Main Competitors

Quantitative Brokers operates in a competitive landscape that includes several key players:

1. Bloomberg Tradebook: A well-established trading platform offering a range of execution services.
2. Goldman Sachs Execution & Clearing: Known for its advanced trading algorithms and analytics.
3. Instinet: A pioneer in electronic trading and algorithmic execution.
4. Liquidnet: Focused on institutional trading and providing liquidity solutions.

Positioning in the Industry

QB positions itself as a research-driven, technology-focused firm that specializes in algorithmic execution for fixed income and futures markets. Its unique approach to transparency and neutrality differentiates it from competitors that may have conflicts of interest.

Market Differentiation Factors

Quantitative Brokers stands out in the marketplace due to its:

• Research-Driven Approach: Emphasizing market microstructure and algorithmic engineering.
• Client-Centric Solutions: Algorithms are developed in close consultation with clients to meet specific trading objectives.
• Neutral Technology Provider: Offering services without favoring any particular executing broker, ensuring clients receive unbiased execution.

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In conclusion, Quantitative Brokers has established itself as a leader in the algorithmic trading space, focusing on reducing trading costs and enhancing execution quality for its clients. With a strong regulatory framework, a commitment to innovation, and a diverse range of trading solutions, QB continues to play a vital role in the evolution of financial technology. For more information on Quantitative Brokers and its offerings, learn more.