Product Overview: Imperative Execution and IntelligentCross
Company Overview
Imperative Execution is a financial technology company founded in 2016, headquartered in Stamford, Connecticut. The company is led by Roman Ginis, a former trader with Cubist Systematic Strategies, the systematic trading arm of Point72. Imperative Execution is the parent company of IntelligentCross, a groundbreaking US equities Alternative Trading System (ATS).
IntelligentCross ATS
IntelligentCross, launched in September 2018, is the flagship product of Imperative Execution. It is the first US equities ATS to utilize artificial intelligence (AI) to optimize trading performance and minimize market impact.
Key Features and Functionality
AI-Driven Matching Mechanism
IntelligentCross employs AI to optimize price discovery and match orders. This AI-driven approach involves measuring performance, learning from data, and adjusting the matching process in real-time to adapt to changing market conditions. This results in reduced market impact and enhanced market efficiency.
Matching Models
IntelligentCross operates two distinct matching models:
- Midpoint Book: This model accepts only non-displayed midpoint orders, ensuring trades are executed at the midpoint of the bid-ask spread.
- ASPEN: A full limit order book with optional displayed capability. ASPEN is further divided into three books with different fee structures: ASPEN Fee/Fee, ASPEN Maker/Taker, and ASPEN Taker/Maker. Each of these books operates independently, and orders in one book do not interact with orders in another.
Near-Continuous Matching
Orders are matched near-continuously, with match events scheduled using an overnight optimization process based on historical performance data. This process ensures that each security has an individualized matching schedule, computed daily to maximize price stability after trades.
Market Efficiency and Stability
The use of AI and adaptive matching schedules helps in minimizing market impact. IntelligentCross has demonstrated significant reductions in market impact, with metrics showing up to 78% lower market impact compared to the exchange midpoint average. This performance is consistent even in highly volatile market conditions.
Accessibility and Integration
Any registered US broker-dealer can become a member of IntelligentCross, provided they are in good standing with a Self-Regulatory Organization (SRO) and meet other eligibility requirements. The platform is designed to be plug-and-play, requiring no changes to existing trading algorithms or systems.
Data Feeds
IntelligentCross offers a free market data feed called IQX, which includes displayed orders from all ASPEN books. Subscribers can choose to consume data from specific books through separate multicast addresses, enhancing their ability to analyze and optimize trading strategies.
Benefits
- Reduced Market Impact: IntelligentCross’s AI-driven matching mechanism significantly reduces market impact, leading to better execution costs for investors.
- Enhanced Market Efficiency: The platform optimizes price discovery and maintains tighter spreads, contributing to a more efficient market.
- Adaptability: The AI technology adapts to changing market conditions, ensuring optimal performance even in volatile markets.
- Ease of Integration: The platform is designed to integrate seamlessly with existing trading systems, making it accessible to a wide range of market participants.
In summary, Imperative Execution’s IntelligentCross ATS is a cutting-edge trading venue that leverages AI to enhance market efficiency, reduce market impact, and provide better execution quality for investors. Its innovative matching mechanisms and adaptive technology make it a valuable addition to the equities trading ecosystem.