Headlands Technologies

Headlands Technologies, established in July 2009, specializes in developing and implementing quantitative trading strategies for exchange-traded financial products, including equities and other securities. The company is privately funded and does not accept outside investors. Headlands Technologies has a global presence with offices located in Chicago, New York, Austin, Amsterdam, and Singapore. The firm focuses on the intersection of finance and technology, utilizing high-frequency trading (HFT) strategies to optimize market efficiency and engage in market making by posting passive non-marketable buy and sell orders to profit from the spread.

The company employs FPGA technology to achieve state-of-the-art latency in trading and uses a variety of trading strategies such as arbitrage, market taking, and market making. Headlands Technologies operates a backtesting simulator to estimate trading strategy profit or loss on historical data and maintains a market data parser to normalize exchange protocols into an internal format. Their trading strategy receives normalized data and decides whether to buy or sell, with a dedicated order gateway converting internal order formats to each exchange’s order entry protocol.

Additionally, Headlands Technologies records market data in parallel to what’s going into the strategy to verify that the strategy behaved as intended. They employ parameter optimization techniques such as regression and backtesting to find the best trading strategy settings and use production reconciliation metrics to confirm that the state in the trading strategy’s internal algorithm matches calculations using captured market data. The company also utilizes graphical representations of different types of data sets to aid in understanding positions and profits or losses during and after the trading day. Headlands Technologies focuses on reducing latency to improve market efficiency and prevent feedback loops, engaging in continuous research to optimize and analyze trading strategies. Their trading strategies utilize a combination of signals, model-based pricing, and rule-based logic.