Man Group, a renowned London-based hedge fund, has taken a bold step into the realm of technology, creating a revolutionary tool for processing vast amounts of stock data—ArcticDB. Born out of the firm’s need to quickly analyze massive datasets, ArcticDB has evolved into a key asset not just for Man Group but for the broader financial technology sector.
The hedge fund, founded in 1783 and managing approximately $175 billion in assets as of last September, faced a pressing challenge: the inability to find a market solution capable of swiftly analyzing the entire universe of stock prices over time. Rather than settle for existing options, Man Group took the initiative to develop its own tool.
The result of their decade-long effort is ArcticDB, an open-source technology designed to handle the overwhelming flow of tick data, which represents minute-by-minute price changes that occur with each stock trade. The tool can process tick data, as well as daily or weekly stock prices, and is already gaining traction in the industry. In 2023, financial software giant Bloomberg licensed ArcticDB and has since collaborated with Man Group to refine the tool further.
“I think there’s a significant shift happening in financial and capital markets,” said Bloomberg’s Chief Technology Officer, Shawn Edwards. “Our customers need to leverage large and growing datasets to build more robust models.”
ArcticDB’s capabilities are vast, enabling users to run sophisticated data analysis and create models on massive data sets. Despite the tool’s industrial-scale processing power, it doesn’t simply function as an oversized version of Microsoft Excel. Users of ArcticDB interact primarily with lines of code, rather than sifting through enormous spreadsheets. The tool is tailored to assist Man Group’s quantitative analysts, or quants, in identifying market patterns, building risk reports, and discovering investment opportunities—seeking out the elusive “alpha” or above-market returns.
Man Group is now focused on commercializing ArcticDB, recognizing the increasing demand among financial and capital market firms for high-performance data analysis tools. Bloomberg has incorporated ArcticDB into its BQuant analytics platform, enhancing its offerings for financial services companies. Bloomberg’s systems now handle over 400 billion market ticks every single day, and the need for robust, time-series analysis tools is more crucial than ever.
While ArcticDB stands out for its speed and seamless integration into existing data ecosystems, it faces competition from other powerful data analysis tools, including Excel, which can process larger datasets through cloud aggregation. Additionally, other specialized tools have been developed to handle high-volume data. However, ArcticDB’s speed and its natural fit with financial data workflows give it a distinct advantage, according to Jason Strimpel, founder of PyQuant News, a resource hub for quants and finance tech professionals.
The tool has not yet seen widespread adoption across other hedge funds, potentially due to its competition with existing workflows or reluctance to adopt technology developed by a competitor. Nonetheless, Bloomberg’s Edwards sees immense potential for ArcticDB beyond finance, particularly in fields like pharmaceutical research, where data science and machine learning are increasingly applied.
“In every industry, more machine learning and data science are being utilized,” Edwards said. “To explore and experiment with data quickly, tools like ArcticDB are becoming essential.”
As Man Group continues to refine ArcticDB, it may not only transform financial data analysis but also pave the way for advancements in data-heavy industries across the globe.
Related topics:
Can I Withdraw Money From an ELSS Mutual Fund?
When Should I Exit a Mutual Fund?