HPC strategies for financial services: The playing field widens

The financial marketplace today is dominated by growing regulatory requirements, constantly changing liquidity conditions and increasingly complex asset-class strategies by firms across the spectrum. In such an environment, it’s no longer only top-tier banks that need vast amounts of high performance computing (HPC) capabilities to handle the huge number of calculations needed for risk management, trade idea generation, compliance or a host of other functions that sell-side and buy-side organisations carry out.

These HPC capabilities are typically delivered via a grid computing environment – where clusters of computers are configured together, each with one or more multi-core processors, in order to generate large amounts of compute power.

The financial sector is known for its compute-intensive needs, although those needs do vary significantly depending on the type of firm and its market profile. Banks and brokers will typically use HPC and grid computing for tasks such as real-time risk management, as they handle thousands of transactions for clients around the world at any given moment. Proprietary trading outfits, meanwhile, often need HPC to run sophisticated models. For instance, so-called Monte Carlo simulations may involve hundreds of thousands of what-if scenarios whose numbers need to be crunched to work out the probabilities of different trade strategies paying off.

As new vendors and operational models emerge in the HPC space, banks and financial firms of all sizes are finding that HPC is essential to their strategies. Some remain focused on on-premise environments that feature “bare metal” approaches (where physical servers are not shared between tenants via virtualisation). Others are shifting a greater share of operations to the cloud, either on a bare metal or virtualised basis. Still others may be opting for hybrid approaches encompassing a combination of cloud, colocation and on-premise.

But deciding on an HPC and grid compute strategy must take account of a range of issues linked to a firm’s customer base, market focus and geographical footprint. All of these factors will have a direct impact on what scope there is for different infrastructural approaches. In other words, each firm is likely to have a unique set of HPC challenges and opportunities.

The upshot is that HPC considerations now must form an essential component of any forward-thinking financial firm’s strategy.

Chief Technology Officer at Verne Global Tate Cantrell
Founder and Director at Securities Technology Analysis Center (STAC) Peter Lankford
Industry Principal, Financial Services at Atos Michael Davison
Vice President, HPC & Big Data at Atos Andy Grant
Managing Director at Hentsü Marko Djukic
CEO at Adaptive Financial Consulting Matt Barrett
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