Forefront Communications

WatersTechnology: Wells Fargo’s Head of Quant Strategy Explains HPR Deployment

HPR

Forefront Communications

Forefront Communications

John Leone has spent almost 30 years working on the buy side, most recently at Matthew Tewksbury’s Stevens Capital Management (and Tewksbury Capital Management and Trout Trading Capital Management), where he managed market connectivity, direct market access, and prime brokerage and financing relationships. This is all to say that he knows the needs of a quantitative hedge fund.

In the summer of 2019, he decided to cross the street, joining Wells Fargo as the bank’s head of quantitative strategy for its Corporate and Investment Banking unit. When compared with other Wall Street banks, Wells Fargo has not been as aggressive in the quant-tech investment space, but Leone believes that this offers the group a late-mover advantage. And rather than build, Leone’s three decades of experience led him—and thus the bank—to partner with HPR (formerly Hyannis Port Research).

“There’s been a lot of smart discussion about how challenging it can be to compete with Silicon Valley for the best engineering talent. With certain segments of the technology stack, in particular what HPR focuses on, that’s a Herculean task [to build that from scratch] when you look at how the massive tech companies of the world are able to recruit, and how they build engineering teams from very early stages, and have them evolve organically. Our partnership with HPR helps us level the playing field,” Leone tells WatersTechnology.

“HPR, for all intents and purposes, is almost like a Silicon Valley technology firm. They’re able to recruit directly from leading universities, get great engineers, and build direct-to-market systems organically.”

Wells Fargo is now live with eight large hedge funds on the Unimus platform. To start, the bank is incorporating HPR’s market access gateway and its pre-trade risk management tool on its Quantitative Execution desk, though Leone says that the bank will look to migrate other business units onto the platform in the future, as well as add other services, such as HPR’s market data distribution and surveillance offerings.

The key reason for selecting HPR was the flexibility the suite of services provides, Leone says.

“We’re not forced to push some off-the-shelf capability on clients, which is what firms who have legacy, piecemeal solutions often have to do,” he says. “With HPR, we can go to a startup manager that may not have super-advanced order-routing methodologies and things like that, and we can develop a custom solution. We can also go to a very large, established group that has specific ways they do things, and offer them self-directed DMA, [and a] co-located, FPGA gateway.”

Anthony Amicangioli, CEO of HPR, says that of the eight Wells Fargo clients that have been migrated onto the platform, the first two implementations were similar, but the following six needed customization.

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