QuantConnect

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QuantConnect
Privately held company
Founded2011; 8 years ago (2011)
FounderJared Broad
Headquarters,
United States
ProductsQuantConnect Data Explorer, Alpha Streams, LEAN
ServicesWeb Platforms
Number of employees
11 (2019) [1]
Websitewww.quantconnect.com

QuantConnect is an open-source, cloud-based algorithmic trading platform for equities, FX[disambiguation needed], futures, options, derivatives and cryptocurrencies. QuantConnect serves over 65,000 quants from 170+ countries, with customers including hedge funds and brokerages, as well as individuals such as engineers, mathematicians, scientists, quants, students, traders and programmers.

History[edit]

QuantConnect was founded in 2011 by Jared Broad.[1] Broad started the company in his downtime while doing humanitarian work in Chile. They became incorporated in 2013, and they were open-sourced in 2015.[2] The company moved to Brooklyn, NY in 2016, and then company moved to Seattle, Washington in 2018. QuantConnect has raised $1 million over 2 funding rounds, and is funded by Start-Up Chile.[3]

QuantConnect has seen substantial user growth in recent years, going from 45,000 users in December 2017 [4] to 55,000 users in May 2018[5] to over 65,000 users in October 2018.[6] About half of the company's users are in the U.S. and the other half are international.[7] QuantConnect added cryptocurrencies to its platform in October 2017, integrating with Coinbase’s GDAX exchange.[7]

Business Model[edit]

QuantConnect enables the quick design of algorithmic trading systems by providing market data and a cluster computer directly to engineers around the world.[1] The platform has about 70,000 users (as of January 2019)"QuantConnect: QuantConnect: An Open-Source Platform for Hedge Funds". Capital Markets. Retrieved Feb 13, 2019. backtesting and building quantitative trading strategies across multiple markets, including equities, futures, options, cryptocurrencies, CFDs and FX. Once the team greenlights a user-generated algorithm, it is loaded into QuantConnect's Alpha Streams API and priced accordingly by the quant who developed it.[6]

According to Broad, about 5% of users consider their work with QuantConnect to be full-time. Rather, many algo traders use the platform's technology infrastructure to launch their own hedge fund startups.

QuantConnect launched its Alpha Streams project in December 2017.[8] This marketplace provides the community the freedom to license their alpha-generating insights to quantitative funds.[9] Hedge funds that leverage the Alpha Streams API search for algorithms that fit their specific criteria and license them for a monthly fee. Quants earn 70% of these fees, which can run anywhere from $100 to $30,000.[6]

Technology[edit]

QuantConnect primarily supports coding in Python and C#, but also supports other languages through its open-source project, the Lean Algorithmic Trading Engine (LEAN).[10][11] LEAN is an open-source algorithmic trading engine that allows users to do the same algorithm design, backtesting, and trading that they can do on the website. Once users code an algorithm, they can run a backtest on historical data, which provides a full breakdown on how it could have performed in the market in the past.[7]

LEAN is free to download and extend for commercial purposes. There are over 100 LEAN-Powered Hedge Funds, and as of January 2019, there had been 44,000 live algorithms successfully deployed on LEAN, with nearly $1.5B of asset volume traded through the engine.[12]

References[edit]

  1. ^ a b c "QuantConnect Profile". Crunchbase. Retrieved Feb 13, 2019.
  2. ^ "VALUETALKS With Jared Broad, The Founder Of Quantconnect". Value Walk. Retrieved February 13, 2019.
  3. ^ "QuantConnect Profile". Crunchbase. Retrieved February 13, 2019.
  4. ^ Wigglesworth, Robin (December 13, 2017). "QuantConnect platform jostles in crowded field of DIY quants". Financial Times. Retrieved February 13, 2019.
  5. ^ "QuantConnect Launches Algorithm Framework". BusinessWire. Retrieved Feb 13, 2019.
  6. ^ a b c Tuttle, Beecher (October 29, 2018). "When quants go rogue: the case for becoming a hired gun". eFinancialCareers. Retrieved February 13, 2019.
  7. ^ a b c Gopalakrishman, Jayanthi (February 2019). "Connecting Up With Jared Broad". Traders.com. Retrieved February 13, 2019.
  8. ^ "QuantConnect Launches Automated Alpha Discovery Platform". BusinessWire. Retrieved Feb 13, 2019.
  9. ^ Broad, Jared (December 13, 2017). "QuantConnect launches Algorithm Framework". Hedge Week. Retrieved February 13, 2019.
  10. ^ "Lean Algorithmic Trading Engine by QuantConnect (C#, Python, F#)". GitHub. Retrieved Feb 13, 2019.
  11. ^ "QuantConnect.Lean". NuGet. Retrieved Feb 13, 2019.
  12. ^ "Radically Open-Source Algorithmic Trading Engine". QuantConnect. Retrieved Feb 13, 2019.