Data-driven intelligent architecture for FX etrading

Dariush HessamiNews

In the past 60 years, information technology has evolved on a one decade- long innovation cycle. A new cycle has started, which is centered around Data and Artificial Intelligence / Machine Learning and is forcefully gaining momentum
First Published: e-Forex Magazine 93 / Market Data / January 2020
This new evolution has two tenets:
  • Data (or Big Data): It is the ability to capture and store vast amounts of structured and unstructured data in a cost-efficient way. This data will be reused in traditional forms (reporting, analytics, use in systems), but more importantly it is the fuel for new classes of machine learning agents.
  • Machine Learning: It is the range of techniques designed to extract patterns from big data and to implicitly program (behaviors and workflows) based on these patterns.
Why TCA has Failed and the future of ML-driven analysis
Machine learning and e-Trading
Change in paradigm

FX etrading has entered a new phase of innovation which is based on the radical technology changes driven by Artificial Intelligence and more specifically Machine Learning. FX etrading systems have gained in speed and capacity but most of the data is unused today. Machine learning provides a low cost and highly scalable set of technologies to use the huge amount of data to find patterns and implicitly program our systems.

The proposed new Intelligent Data-driven architecture, which will emerge in the next few years, requires in addition, that the FX etrading system is tightly integrated to the ML agents to reprogram themselves with new real-times predictions. It, more importantly, is the provider of data to the ML agent for their training and future evolution. The current discussions on AI and ML are either overly negative; viewed as ‘killing’ jobs . Or overly optimistic; seen as the panacea of all unsolved problems. Both assertions are false. FX etrading has already automated a great number of routine jobs.

The yesteryear trading floors....