Buy-Side Technology Awards 2015: Best Buy-Side Newcomer (Vendor or Product)—Algomi

Algomi sits in the middle of what has proven to be a fitful problem for the buy side: fixed-income liquidity sourcing.

The asset class has historically struggled with electronification, especially given the irregular blocks frequently traded within it and the imbalance of corporates inventory now sitting with the buy side, rather than with the banks. Honeycomb doesn’t try to fix that gargantuan problem by itself, but that is one of its strengths—it is designed to move things forward by cleaning up a foundational problem first: lack of information.

The bond information network now has in excess of 150 buy-side firms and 14 banks, either participating or being on-boarded, and works by ensuring full confidentiality of identity and intentions. Without fear of being front-run, buy-side users can view multiple sell-sides firms’ pricing and inventory at once, and compare these to their own portfolio and trade workflow via an intuitively designed front-end. Once a suitable match is found, they can then pursue execution via traditional means already available.

Whereas many young firms are remiss to highlight their products’ technology underpinnings, three year-old Algomi is also proud of what’s underneath the Java-based Honeycomb application. The architecture is designed to be modular and distributed, and the system is built on asynchronous messaging between components that enables loose coupling, isolation, and location transparency. An in-memory data cache further pushes performance improvements. 

Perhaps it isn’t surprising that Algomi has made a splash so quickly: its co-founders’ heritage includes time spent at UBS’ famed PIN-FI platform and CAXPD. Building out this platform was no toe-dipping exercise; these guys are all-in. Combining rapid uptake with well-designed information management is no easy task in a market like fixed income where neither of those comes easily.

Without fear of being front-run, buy-side users can view multiple sell-sides firms’ pricing and inventory at once, and compare these to their own portfolio and trade workflow via an intuitively designed front-end. Once a suitable match is found, they can then pursue execution via traditional means already available.

Once corporates’ liquidity crisis finally shakes out, there will be much written about the electronic platforms that outlast the rest—but that saga will most properly start with the Algomi's of the world.