Clear Street’s Madhu Subbu leads securities finance engineering at Clear Street. The team has worked at large broker-dealers in the past, and experienced firsthand the frustrations with antiquated and inefficient operations. One of those pain points has to do with locates.
“We knew that with our technology and skillset we could build a state-of-the-art locates platform that would solve the issues our team and clients were facing. After months of research and development, ATLAS was born,” Subbu writes in a blog post.
ATLAS (Automated Trading Locates Allocation System) is Clear Street’s proprietary trading system that allocates stock loan inventory to incoming customer requests. Customers can submit locate orders directly from their Order Management System via a FIX interface, or use a web portal. It has a fully automated ReST API to programmatically submit locate requests, which can be adopted by quantitative trading strategies and robo-advisors.
ATLAS maintains a unified view of all incoming locate requests. A locate request is priced in real time based on the security’s various demand and supply characteristics, market events, and inventory availability. ATLAS responds with an offer, and customers have the option to examine the price before accepting. Once the customer accepts our offer, ATLAS decrements the approved locate quantity from availability and the customer is able to enter a short sale order.
ATLAS is one component of a larger system that aims to address legacy workflows and silos, also expected to increase access in the financial markets. Olympus, the broader Clear Street securities finance stack (of which ATLAS is a part) will soon expand to include real-time inventory availability and streaming borrow rates.
“We’re also building a marketplace for stock loan, which we expect to share more details on in the near future. It’s all part of our plan to modernize the market infrastructure across capital markets, and improve market access for all participants,” Subbu writes.