Proof Trading Progress Update: Q1 2024

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Proof Reading

5 min readApr 8, 2024

Our sixth year is off to a great start with continued growth as many major new clients went live this quarter. Operationally, things are running smoothly, and we deployed significant new technology features to accommodate all the needs of this new wave of customers. We made solid progress on the product and research fronts, and we have several exciting releases and announcements coming on the horizon. Like any startup, there are always dozens of balls in the air at any given point, which certainly keeps us on our toes, but overall there is not too much to complain about these days. Hopefully we can keep this positive momentum going!

Major updates from Q1 2024

Allison published a whitepaper on closing auction volume prediction. Blog post to follow shortly.
Went live with 5 new clients.
Built and released several significant technology projects including:
- Updated our algo specification to add tickets for the Aggressive and Close algos and make the interface more intuitive for existing algos.
- FIX Enrichment framework to allow client specific customization without requiring code changes.
- FIX-based post-trade/allocations engine.
Successfully completed 2023 annual financial audit as well as all annual regulatory/compliance tasks.

Goals from our previous update

Technology

Automate post trading system deployment

(10/10) Our post trading system now follows the same model of our trading system to make sure UAT and PROD are always in synch.

Set up FIX Allocation process

(10/10) FIX Allocation process was already onboarded for 2 clients and it is running smoothly.

Enhance our monitoring UI with more views and filtering/sorting capabilities

(10/10) UI updates were made to enhance our monitoring capabilities

Complete the transition from Credit Suisse to UBS as our second DMA provider (in addition to Barclays).

(8/10) Certification is completed. Working now to deploy sessions in Production.

Complete any outstanding EMS/OMS integrations for next wave of new clients.

(10/10) All outstanding integrations were completed.

Product/Research

Complete an initial model for closing volume prediction and accompanying whitepaper. (highest priority)

(10/10) We just released our new whitepaper on this on our website. A shorter blog post about its highlights will be coming shortly.

Publish our quant researcher training materials as a freely available course. (For real this time? Oh the suspense!)

(2/10) Nope, not this time. Stay tuned.

Build on our information leakage research and incorporate it into products.

(4/10) In our previous information leakage work, we developed a framework for defining and measuring information leakage, as well as a way to solve for optimal trading strategies within the framework in some instances. We are now working on extending our optimization results to a broader range of scenarios that we expect will make it product-ready.
We also presented our information leakage framework in several invited talks and conferences this quarter, both to finance industry folks and computer scientists. The response was very positive, and we are excited about the feedback and possibilities for new collaborations on this topic.

Build, test, and deploy our 4th algo (into-the-Close) to Production.

(2/10) Work on this has started, but was understandably held back by waiting for the underlying research. This is now (mostly) unblocked and should move quickly.

Make significant progress on our basket trading initiative.

(2/10) We are collecting information about basket trading and analyzing how our infrastructure will work. Stay tuned for more updates on this initiative.

Sales/Marketing

Go live with at least 5 new clients and begin the onboarding process with at least 5 new clients.

(8/10) We went live with 5 new clients in Q1 and currently in the onboarding process with 3 new clients. Our onboarding process has been moving at a swifter pace, while there are still components that are out of our control, as our brand and product is becoming more established, we are finding fewer hurdles in conversion process. The focus for the next quarter will be to continue to focus on adding prospects to the pipeline such that we can maintain this pace of onboarding.

Hire a client-facing product specialist (sales, coverage, product-specialist all-in-one), but really a key hire who can execute and drive our distribution strategy forward.

(2/10) This is a binary measurement and we haven’t filled this role yet. But! We’ve done a lot of groundwork- sourcing, interviews, and reference calls. This is a very important role to us and we’re very particular about the experience we want to provide to our clients, so we’re willing to be patient for the right fit. Hopefully we’ll have more to report on this in Q2.

Continue implementing a more systematic business development strategy.

(5/10) Continues to be on-going effort. We’re diversifying our methods of outreach (watch out for our new podcast to drop in the coming weeks!) and with potential for new products on the horizon, we’re hopeful there will be new parts of the client universe we will be relevant to. In the meantime, we’re continuing our existing outreach strategy and will look to migrate to a CRM in alignment with our hiring timeline.

Operations/Regulatory

Obtain NY State WBE Certification for our broker-dealer subsidiary, Proof Services LLC.

(0/10) This is still in progress, we have responded to all of the state’s requests, but we have not received a final decision yet. We’ve also begun the process of getting on various state MWBE broker lists.

Goals for the next 3 months