The Gateway to Algorithmic and Automated Trading

A cloudy data centre

Published in Automated Trader Magazine

Cloud computing offers increased security potential and vast resources to fuel the computational demands of trading. It can do this while still offering users operational ownership control over costs. For firms looking to make the transition from on-premise to the cloud, here are some of the key considerations.


David Rukshin

David Rukshin oversees more than 120 technologists at WorldQuant, LLC, a technology-driven quantitative investment firm based in Old Greenwich, CT. Prior to joining WorldQuant as CTO in 2014, he spent 16 years at D. E. Shaw Group. A car enthusiast, he began his career as a systems programmer at AT&T Labs Research.

Quantitative investment managers such as WorldQuant deploy large arrays of servers to construct their portfolios. For the thousands of data scientists - 'quants' in industry parlance - located around the world using the WorldQuant platform, computing resources are like oxygen: Our quants rely on them to do their work and they can consume just as much compute as they are given access to. The firm's ability to provide quants with the computing resources they need, when they need them, is of paramount importance.

Although the basic resource-sharing concepts of cloud computing hark back to the days of mainframes, it arguably has been one of the largest disrupters in the world of information technology management in recent years. The premise of cloud providers is that they can make computing resources available in minutes, compared with a more typical multimonth IT provisioning cycle. With WorldQuant's insatiable need for ever-more computing resources, effective leveraging of the cloud is a potent weapon in our armory.

Amazon began offering its Elastic Compute Cloud more than a decade ago and other major players, such as Google and Microsoft, rapidly followed. Although many businesses, particularly start-ups, embraced the cloud relatively quickly, others, especially those in regulated industries such as finance, have been much slower to adopt the technology. Foremost among their concerns are the security and privacy of data and the risk to intellectual property. The multitenant nature of public cloud, wherein multiple customers share the same physical plant, and the cloud's exposure to the public Internet, exacerbates these concerns in the minds of IT professionals, business leaders and investors.

A no-brainer for smaller firms

As cloud technology has matured over the past decade, adoption has steadily grown beyond the start-up world and beyond token deployments for quality assurance and development environments by Fortune 500 companies. Security is still important, but the conversation about the use of cloud technologies for production systems has moved beyond the issue of fear, uncertainty and doubt to the question of the most effective ways to leverage the cloud. Concerns about security have given way to the practicalities of how best to integrate the cloud's capabilities. A cloud-only option is now a no-brainer for smaller and start-up buy-side firms. The investment required to build internal IT infrastructure and recruit talented staff is significant and in many cases unnecessary if the organisation has the luxury of starting with a blank slate. The situation for larger and more established firms is far more complex, especially for those that have already made significant investments in on-premise data centres.

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