Proof Trading Progress Update: Q2 2024

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Proof Reading

4 min readJul 5, 2024

Everything is humming at Proof. Our recent wave of new clients have continued to ramp up, and as a result this past quarter was our best ever across all metrics — volume and notional traded, revenue, etc. Our next algo release (into the Close) is right on the horizon. We hired a new head of sales, and we have a slew of major technology and operations projects coming down the pipeline. Spirits are high, and there is a ton of work to do!

Major updates from Q1 2024

By far, our best quarter ever in terms of volume, notional traded, revenue, etc.
Published our Close Volume Prediction paper, along with an accompanying blog post.
Hired a Head of Sales (stay tuned for announcement next week!).
Recorded our first ever podcast, to be released in the coming weeks. Stay tuned!

Goals from our previous update

Technology

Enhance FIX customization framework to support conditions.

(10/10) Done

Enhance internal cost analytics and cost plus billing infrastructure.

(10/10) Done

Make our post trading system segregated by client to avoid batch delays.

(7/10) We segregated NYFIX allocation clients from CTM clients. The next goal is to fully segregate clients even inside the same allocation platform.

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

(8/10) Most of the work is done for Lit Markets. Waiting now dark sessions from UBS to continue.

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

(10/10) All integrations completed.

Product/Research

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

(7/10) We conducted several rounds of feedback sessions with current and prospective clients on this algo’s design and interface, and most of the development work is completed. The next phase is testing and validation, and we expect to be live in production by the end of the month.

Make significant progress on our basket trading initiative.

(3/10) We developed an initial version of the interface and started discussions with EMS/OMS vendors on how to receive basket orders. There is still quite a bit of design and development work remaining, particularly around the interaction between the basket management layer and our existing single-stock algorithms.

Iterate on our TCA framework and further study our increasing sample of live trading data

(5/10) We have added some new metrics to our TCA analyses and continue to learn what we can from our live trading data, though we still have work to do to improve our techniques for controlling noise.

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

(4/10) We are making progress on expanding and applying our information leakage framework, but still have work to do before releasing a new whitepaper or a new product feature based on it.

Publish our quant researcher training materials as a freely available course. (Someday we’ll get back to this!)

(3/10) We are back to editing these, expecting to release a textbook draft and some accompanying Jupyter notebooks within the next quarter.

Sales/Marketing

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

(2/10) We went live with 1 new client this quarter. While it was quieter on the onboarding front, we’ve had a big uptick in activity from our existing clients and we’re in the process of building up a more robust pipeline for clients coming on live over the next 2 quarters.

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.

(10/10) Our lengthy search for a sales/coverage person is finally over. We’re excited for our new addition to the team- watch out for an announcement next week! We feel confident about the progress we will be able to make on the client engagement front, both existing and prospective.

Continue implementing a more systematic business development strategy.

(5/10) Still work to be done on this front. Now that we’ve made a sales hire, we plan to implement a CRM in the coming months and will have better metrics around engagement.

Operations/Regulatory

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

(0/10) Holding pattern here, still waiting on a response from the State.

Goals for the next 3 months