Itiviti, the trading technology provider, has announced a partnership with automation and AI specialist Imandra that will see Imandra's engine incorporated into Itiviti’s FIX certification and onboarding solution, Conductor.
FIX (or the Financial Information eXchange protocol to use its full name) is designed to standardise the electronic messaging that exchanges and trading venues use to transact securities deals,
Imandra (formerly known as Aesthetic Integration), applies a formal verification methodology to map complex financial systems and, in the case of FIX certification this modelling is applied to the multitude of "edge cases" - or scenarios that have to be considered - for regulatory compliance. With FIX protocols, the edge cases multiply not only because of the requirements of different regulators, but also with the lengthy FIX specifications of different exchanges. These run to 196 pages for the London Stock exchange, for example; 158 pages for Xetra and 122 pages for Euronext.
The complexity of the onboarding process means that it can take new counterparties up to six months to write the source code for FIX connectivity.
Imandra addresses the challenge by using a mathematically precise methodology to create a manageable number of test-able edge cases for automated checking for compliance. With the upgrade to Conductor, onboarding times will be reduced to hours, Itiviti and Imandra said.
Imandra's process is described by co-CEO Denis Igantovich as “reasoning in an automated way”. Sitting at the crossing point of artificial intelligence, mathematics and computer science, formal verification boils down to a process of working out the likelihood of something happening.
In the past, formal verification and model-based software engineering have been more widely used in the development of avionics software than for financial software. However: “With the ever-growing complexity of financial markets, the need for rigorous, quantitative and scalable methods to deliver quality software could not be greater,” said Ignatovich. “We can automatically map out the full functional behavior of a system and generate test vectors for rapid client onboarding.”
Imandra and Itiviti have been working together for more than one year, and the new integrated solution is now being offered to Itiviti clients. “Our partnership with Imandra has been an industry game-changer, helping to transform a historically manual and time-consuming client certification process through automation,” said Linda Middleditch, head of product strategy and engineering, Itiviti. “Now, our clients can see a significant reduction in time-to-market for onboarding and certification while experiencing a significant improvement in the quality of their testing coverage.”
You can read QA Financial's 2016 profile article on Imandra (formerly Aesthetic Integration) and formal verification modelling here: https://www.qa-financial.com/articles/feature-modelling-dark-pools-with-maths .