Almax Enlists Victory Networks, Sumo Capital for AI News Platform Testing

The platform uses qualitative and quantitative data to deliver deep analysis and predictions on the direction and magnitude of stock movements. Traders and asset managers building and executing strategies across all asset classes can subscribe to stocks they are interested in (initially US equities only, though Almax will incorporate more asset classes and regions as the platform develops) and the platform monitors both structured news sources such as Thomson Reuters and Bloomberg, as well as corporate websites, blogs and social media sites to detect triggering events.

In order to test the platform ahead of launch, Almax has recruited Victory Networks - which provides data and trading infrastructure technology to firms including Nasdaq, CME Group, the Chicago Board Options Exchange (CBOE), Goldman Sachs, NYSE and Bank of America Merrill Lynch - to test out the deployment of its predictive analytics for equities with Victory Networks' customer, Chicago-based proprietary trading firm, Sumo Capital.

Sumo, which is the third largest market maker on the CBOE, will test the system to ensure it provides valuable insight on the equity side, which will help Almax make improvements before the full version of the platform is released in six months, but will also benefit Sumo Capital by "generating revenue for them" and improving the spreads on the market-making side, says Balazs Klemm, chief executive and founder of Almax analytics.

Mark Cukier, a lead trader at Sumo, says that firms are looking to AI solutions because "if you are not integrating machine learning into your strategy you are just standing in the back of the line." He adds that while he cannot fully share how they plan to test the platform, the firm will "carefully test the intersection of the Almax platform with our proprietary data to set positive expectation levels," and if the integration results are what they expect, they will "carefully consider a full integration."

Almax identified Victory Networks as a potential partner for US testing based on their customer base and list of partners which include clearing firms, exchanges, and proprietary trading firms, and while the deal will provide the vendor with access to a larger US customer base, Victory Networks will also benefit by being able to present the platform to its clients.

"Our customers seek to always generate significant alpha and more critically, to avoid risks and to be more efficient. Gaining the ability for precision trading decisions with news and insights will prove to be advantageous," says John Superson, chief executive of Victory Networks.

Superson adds that he believed "anyone involved in the market place should have interest in this product," and plans to offer Almax to other clients. "Information transcends all desks. There is a large bottleneck in the industry surrounding the sheer amount of information and content in our business - whether it's real time news which affects markets in the short term, or research analysis over a longer period of time - our clients are always interested in solutions which seek out the most relevant content based on their strategy and also something that can deliver that in a variety of forms whether through an API or front end."

When Almax launches the news platform launches later this year, it is likely to operate in tandem with existing platforms such as Bloomberg and Thomson Reuters' news feeds rather than replacing them.

Almax is now targeting other test clients its three main markets; trading desk, analysts and hedge fund managers. The vendor is already in beta testing with a range of users including an analyst at an investment bank and a trading desk at a large asset manager, though Klemm declines to name them. Once the test phase is over, Almax plans to expand its stock coverage and hire new staff including salespeople, developers, programmers, analysts and data scientists.