Northern Trust advances currency management with artificial intelligence

Northern Trust has enhanced its Foreign Exchange (FX) currency management solutions with machine learning models designed to enable greater oversight of thousands of daily data points and help reduce risk throughout the currency management lifecycle.

The solution has been developed in conjunction with Northern Trust’s strategic partner Lumint Corporation.

The advanced technology utilised by the Robotic Oversight System (ROSY) for Northern Trust, systematically scans newly arriving, anonymised data to identify anomalies across multi-dimensional data sets. It is built on machine learning models developed by Lumint using a cloud platform that allows for highly efficient data processing.

Andy Lemon, head of currency management, Northern Trust, says: “In a data-intensive business, ROSY acts like an additional member of the team working around the clock to find and flag anomalies. The use of machine learning to detect data outliers enables us to provide increasingly robust and intuitive solutions to enhance our oversight and risk management, which can be particularly important in volatile markets.”

Alex Dunegan, CEO, Lumint, says: “Northern Trust’s deployment of ROSY amplifies the scalability of its already highly automated currency hedging operation; especially for the more sophisticated products such as look-through hedging offered to its global clients. We look forward to continuing to collaborate with them as the demand for scalable and flexible currency management solutions moves to the next level.”

Northern Trust announced a strategic partnership with Lumint in 2018 to drive innovation in currency hedging, including comprehensive transparency reporting and analytics to meet the evolving needs of asset owners and asset managers.

Northern Trust’s global currency management suite comprises portfolio overlay, share class hedging and look through hedging solutions to help mitigate currency volatility, while actively supporting investment manager distribution strategies. It forms part of the Northern Trust Global Foreign Exchange offering from Northern Trust Capital Markets, providing a range of liquidity, trading, transparency and foreign exchange solutions for institutional investors. Northern Trust Capital Markets provides brokerage, securities lending and transition management services, in addition to foreign exchange. It is a division of Corporate and Institutional Services, which provides asset servicing, fund administration and middle office and revenue enhancement solutions to institutional asset managers and asset owners around the globe.