SIX – which owns and operates the Swiss stock exchange – has entered into a strategic partnership with Israel’s Cortica and Hong Kong’s Duotem Capital to develop AI-based services for the securities industry. Initial work will focus on the post-trade industry.

In an MOU signed on October 18, 2018 SIX entered into a strategic partnership with Cortica and Duotem Capital to deliver Artificial Intelligence-based services covering collateral and cash optimization for the post-trade industry.

Tel Aviv and New York based Cortica develops next generation artificial intelligence technology that learns on its own in real-time, interacts with the real world and collaborates with other technologies and machines.

Duotem Capital in Hong Kong and SIX together with Cortica will collaborate to identify and evaluate AI-based business opportunities in SIX’s existing business areas to develop new business offerings for SIX in the financial sector. These include the recognition of trading patterns (e.g. front running, spoofing, insider trading, etc.), the creation of algorithms to identify fraudulent payments, machine-learning support for manual corrections in the post trading domain as well as the creation of a real-time business operation dashboard. Further use cases will be evaluated by the organisations over the course of the initial phase estimated to last for one quarter.

To enable the creation of these – and potentially other – solutions SIX, through its stock exchange arm, will make its historical transaction data available to Cortica for modelling and algorithm development.

According to Thomas Zeeb, Member of the Executive Board and Head of the Securities & Exchanges business unit at SIX, ‘Today’s AI capabilities, coupled with self-learning technologies, open up a world of possibilities and opportunities for us to improve the way we perform in terms of efficiency, transparency and compliance as an industry. We are at a point in the post-trade arena where breakthrough solutions – such as those promised by organisations such as Cortica and Duotem – can radically transform the way we interact with our clients and help them to strengthen their credibility for more sustainable business relationships with their clients and investors.’

Philippe Metoudi, CEO, Duotem Capital sees great opportunity, ‘ I have seen, first hand, the challenges financial institutions face in keeping up with regulation and compliance pressures while simultaneously trying to develop intelligent and automatable solutions for their operational businesses. With this approach, we at Cortica and Duotem – working with SIX – plan to create solutions that resolve these industry-wide issues by bringing in today’s future-oriented technologies and applying systems that can learn faster, adapt more rapidly and deliver to a higher quality. We are delighted that SIX has seen the potential for industry-wide service improvement without jeopardizing existing, mission-critical, infrastructure.’

Work has already begun with the expectation that a viable service can be farmed in the coming three months.

Source: SIX