Quantum computer-powered bond trading has performed 34% better than classical techniques in a trial conducted by HSBC and IBM.
The two firms were jointly exploring how quantum computers can be used to predict how likely a bond trade would be filled at a quoted price, with the findings suggesting the technology has a real future in trading.
Algorithmic trading in the corporate bond market is the practice of using computer models to automatically price customer inquiries in a competitive bidding process.
The trial from HSBC and IBM attempted to understand how quantum computers could optimise this process.
The results have suggested the value quantum computers could offer when integrated into the financial service industry.
“This is a ground-breaking world-first in bond trading. It means we now have a tangible example of how today’s quantum computers could solve a real-world business problem at scale and offer a competitive edge, which will only continue to grow as quantum computers advance,” said Philip Intallura, HSBC’s group head of quantum technologies.
“We have been relentlessly focused on the near-term application of quantum technology, and given the trial delivered positive results on current quantum computing hardware, we have great confidence we are on the cusp of a new frontier of computing in financial services, rather than something that is far away in the future.”
Financial institutions like HSBC have become keen backers of the quantum computing space in recent years.
“This exciting exploration shows what becomes possible when deep domain expertise is integrated with cutting-edge algorithm research, and the strengths of classical approaches are combined with the rich computational space offered by quantum computers,” said Jay Gambetta, vice president at IBM Quantum.
“Such work is essential to unlock new algorithms and applications that are poised to transform industries as quantum computers scale, and the future of computing takes shape.”
