The Deep Dive
Innovative exploration in a fast-evolving quantum world
The Fidelity Center for Applied Technology utilized Amazon’s Braket service to develop hardware-agnostic quantum algorithms that capitalize on the individual strengths of different quantum technologies in a hybrid quantum environment.
FCAT’s Exploration of Quantum Computing
While it is unclear when quantum computers will reach their full potential, research indicates that there is potential for quantum computers to displace classical computers in the future with significant benefits for financial services firms. At FCAT, we experiment with emerging technologies to identify how they might impact Fidelity’s business and customers. We are researching quantum computing with the objective of being ready when this emerging technology becomes commercially viable.
Additionally, we seek to encourage a mind shift from classical thinking towards “quantum thinking” throughout the organization. As a part of this journey we are exploring a wide variety of quantum computing technologies that currently exist and building Proof of Concept prototypes that are interesting to Fidelity and our customers. We believe now is a good time to engage with this emerging technology as current NISQ (Noisy Intermediate-Scale Quantum) devices enable us to understand the technology and define appropriate use cases as we upskill our employees on how to develop for a quantum computer.
Synthetic Security Creation and Option Pricing
FCAT teamed up with Amazon’s Quantum Solutions Lab to create a Proof of Concept that pushes the boundaries of what is possible today with cloud-based quantum computers. FCAT developers used Amazon Braket to develop a hybrid quantum-to-quantum algorithm for a potential asset management use case.
For this use case, we developed a custom binary quadratic model (BQM) that evaluates a list of potential stocks to determine which mix of those stocks would yield a synthetic security whose cumulative attributes match those of the specified target index. This BQM was then sent to a quantum annealer to find the optimal composition of this new security. Once the composition was determined, the results were then sent to a gate-based quantum computer which used amplitude estimation to calculate the prices of options on that security.
This PoC showcases the potential of using different quantum technologies in concert as well as a hardware-agnostic approach which enables Fidelity to easily switch to new quantum systems as they become available. We are still in the early days of quantum computing, but the technology has already shown potential to displace technologies that we use today. This approach positions FCAT to maximize quantum computing capabilities by nimbly switching to the latest best-of-breed quantum systems as they evolve.