QuantConnect: Revolutionizing tomorrow’s financial trading

About QuantConnect

One of the world’s largest quantitative trading communities, QuantConnect provides a free algorithm backtesting tool and 400TB of financial data so engineers can design and optimize algorithmic trading strategies.

Industries: Financial Services
Location: United States

After experiencing stability issues with another cloud provider, QuantConnect moved to Google Cloud Platform for the reliable, scalable infrastructure essential to its business model.

Google Cloud Results

  • Empowers investors with more reliable cloud infrastructure for algorithmic trading
  • Scales 6x with almost minimal manual intervention, keeping headcount and costs static while providing for future growth
  • Improves performance up to 20% with Intel Xeon “Skylake” processors

50K+ quants use the QuantConnect platform

In financial markets, quantitative analysts—or quants—are in high demand for their deep understanding of the complex mathematical models that price financial securities. Many quants work primarily on developing algorithmic trading strategies—automated trading instructions that account for market variables and execute trades much faster than a human trader to generate more profits.

Once strictly the domain of large hedge funds, algorithmic trading is being democratized by companies such as QuantConnect, which provides an open-source platform that enables anyone to design algorithms and share strategies. More than 50,000 quants use QuantConnect to research and analyze investment strategies in Equities, Forex, Crypto, Options, and Futures markets. They backtest their algorithms against free historical high-resolution data dating back to 1998. When users are satisfied with their strategies, they can quickly deploy them to their brokerage for live trading.

“Trust in your infrastructure is essential with algorithmic trading. In the financial sector where algorithms are running long-term and intensive processes, there’s no substitute for Google Cloud Platform. If a VM goes down, another takes over in milliseconds.”

Jared Broad, CEO and Founder, QuantConnect

While QuantConnect users can choose to run the open source project on their own infrastructure, others want to harness the speed of cloud computing for faster strategy development. Thousands of people use the cloud platform for intensive workloads every day. In live trading, an investment strategy can run for months—and with live capital running through the system, the reliability of the company’s application is absolutely paramount. If the platform crashes, some users would get frustrated and leave. After experiencing stability issues with its previous cloud provider, the company moved cloud-based strategy design to Google Cloud Platform.

“Trust in your infrastructure is essential with algorithmic trading,” says Jared Broad, CEO and Founder of QuantConnect. “In the financial sector, where algorithms are running long-term and intensive processes, there’s no substitute for Google Cloud Platform. If a VM goes down, another takes over in milliseconds.”

“Since moving to Google Cloud Platform, we’ve grown the business sixfold without increasing staff or our IT costs. It’s impressive that Google Cloud Platform now enables us to manage six times more business while keeping our costs flat.”

Jared Broad, CEO and Founder, QuantConnect

Supporting 6x business growth

QuantConnect uses Google Kubernetes Engine, a managed, self-healing container service, to scale its platform and provide high uptime with little manual intervention. A user can simply click a button on the QuantConnect website and spin up hundreds of servers for however long they are needed. Its database is hosted on Google Cloud SQL—another managed service—and protected by automatic failover for high availability. Backups, replication, patches, and updates are all automated, helping to keep the company’s eight-person team focused on innovation.

“Since moving to Google Cloud Platform, we’ve grown the business sixfold without increasing staff or our IT costs,” says Jared. “It’s impressive that Google Cloud Platform now enables us to manage six times more business while keeping our costs flat.”

Moving 400TB of data to the cloud

To move its massive data library to Google Cloud Platform, QuantConnect uploaded the data to Google Cloud Storage Nearline where it can be easily accessed with sub-second response times. Two Google engineers were on hand to make sure the migration went smoothly.

“We are able to store all our options data in Google Cloud Platform for backup, and batch process 400 terabytes cost effectively using preemptible VMs,” says Jared. “Google made it all quite easy for us and we’ve had very human interactions with them, which was nice.”

A more resilient cloud platform

Because stateful information isn’t stored exclusively on any single instance, the loss of an instance in Google Cloud Platform does not stop a user’s backtest. Therefore, QuantConnect can offer unprecedented uptime. Users can backtest their algorithms hundreds of times in a row and analyze the results to fine-tune their strategies. “That’s really only possible with an infinitely scalable, resilient cloud with affordable options such as preemptible VMs,” says Jared.

As its business grows, QuantConnect is distributing services over more zones and regions for even greater resiliency.

“Google Cloud Platform makes it easy for us to put services in multiple zones and set up VMs that can only be accessed from the internal network,” says Jared. “It’s very flexible and gives us the controls we need to serve the financial services market. Thanks to stability gains, the community is trusting us and staying with our system.”

QuantConnect takes advantage of the highest performance processors Google makes available—currently Intel Xeon processors, code-named Skylake—for up to 20% faster compute performance.

“Seamless collaboration with G Suite makes a huge difference when working with an open-source community, especially when you’re pushing the boundaries of quant finance.”

Jared Broad, CEO and Founder, QuantConnect

Connecting the quant community

To share and discuss strategies and ideas with some of the brightest minds in the quant world, QuantConnect’s employees and open source contributors use G Suite for collaboration. They rely on Google Docs to comment on and edit documents in real time, and use Google Drawings on Google Drive to sketch out project architectures. By fostering a tight-knit community, QuantConnect is helping users learn from others’ mistakes and improve the effectiveness of their strategies.

“Seamless collaboration with G Suite makes a huge difference when working with an open source community, especially when you’re pushing the boundaries of quant finance,” says Jared.

Using Google Container Registry, developers can quickly retrieve container images and take advantage of Google’s proximity to major financial exchanges to set up their own automated algorithmic trading servers.

“Users can set up their own trading server for about $5 a month using a micro-instance on Google Cloud Platform, with about a 10-millisecond ping to the exchanges,” says Jared. “It’s a revolutionary level of technology that we can give them at a really low cost.”

“Google has been very supportive of QuantConnect, helping us offer reliable cloud processing at a competitive price. With their help we’ve been able to offer faster backtesting on more data, allowing our community to be more productive.”

Jared Broad, CEO and Founder, QuantConnect

Empowering investors with new services

With Google Cloud Platform, QuantConnect can offer reliable cloud optimization as an essential part of its business model, driving needed revenue to the open source project. It can also offer innovative new services, such as the recently launched crypto currency trading—including Bitcoin, Ethereum, and Litecoin digital currencies—on the GDAX exchange. As it adds more live data feeds to support options and crypto trading, QuantConnect can easily scale to petabytes of data in Google Cloud Platform.

“Google has been very supportive of QuantConnect, helping us offer reliable cloud optimization at a competitive price,” says Jared. “With their help we’ve been able to offer faster backtesting on more data, allowing our community to be more productive.”

About QuantConnect

One of the world’s largest quantitative trading communities, QuantConnect provides a free algorithm backtesting tool and 400TB of financial data so engineers can design and optimize algorithmic trading strategies.

Industries: Financial Services
Location: United States
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