22/06/17

Quant fund is concerned about CFTC getting its software code

Renaissance Technologies, the $65 billion hedge fund, is pushing back against federal regulators’ interest in highly-technical trading software out of concern that their source code wouldn’t be secure in the government’s hands, reports the New York Post.  

The Commodity Futures Trading Commission is interested in digging into the software at so-called “quant” funds, which use highly-secretive algorithms to execute trades.

At an industry conference on Tuesday, James Rowan, the fund’s chief operating officer, said that he was concerned that source code could “leak,” and that Renaissance is exploring ways it can share the code in a secure setting and could have it returned to them, according to two people who were present at the conference.

Two attendees of that private conference had told two Post reporters that Rowan said that the CFTC had requested code for Renaissance’s trading software.

Rowan denied that late Wednesday, saying he was misquoted.

“There is no probe of Renaissance,” Rowan said. “I was referencing a comment letter provided by the Managed Funds Association regarding the CFTC’s proposed Regulation AT.”

“The CFTC has not made any inquiries or requests related to the source code of Renaissance Technologies,” Erica Elliott Richardson, of the CFTC, said in an email.

Earlier Wednesday, a Renaissance spokesman had declined to comment and the CFTC hadn’t returned a request for comment.