The quantum computers that can be bought today are made by D-Wave Systems Inc., a 16-year-old Canadian company that has raised $174-million from backers, including Goldman Sachs.STEPHEN LAM/Reuters
You may soon be able to see every conceivable outcome of a wager, say, on interest rates, over many time horizons – thanks to computers that rely on the uncertainty at the root of all matter.
Wall Street is turning its attention to quantum computers, an emerging technology that aims to exploit the properties of subatomic particles to make extremely complex calculations at unprecedented speeds. Goldman Sachs Group Inc., Royal Bank of Scotland Group PLC, CME Group Inc. and Guggenheim Partners are evaluating quantum computing, which requires temperatures colder than in outer space.
The technology is exceptionally complicated, and researchers are debating whether machines now on the market are as powerful as advertised. If successful, these supercomputers could give money managers and banks, whose algorithmic-driven technology already dominate trading, another advantage in a highly competitive market. They can help managers better allocate money to a broad range of assets, find new ways to profit from differences in prices across markets and value complex derivatives structures, said Marcos Lopez de Prado, a senior managing director at Guggenheim Partners.
"The quantum computer is very good at a few things that happen to be very, very hard for traditional computers," said Mr. Lopez de Prado, also a research fellow at Lawrence Berkeley National Laboratory. "It can solve complex problems in exponentially less time."
The cost: at least $10-million (U.S.) per computer, he said.
Google Inc. is designing learning algorithms that work on a quantum computer and is collaborating in its research with the National Aeronautics and Space Administration, which has one of the machines. It has demonstrated the ability to crunch through very complex problems in a matter of seconds that would take traditional computers 10,000 years, Hartmut Neven, a director of engineering at Google, said at a press conference.
The quantum computers that can be bought today are made by D-Wave Systems Inc., a 16-year-old Canadian company. D-Wave has raised $174-million (Canadian) from backers, including Goldman, which has invested its own money in the company.
The performance of today's binary computers is determined by the number of transistors that fit into a space and how cleverly engineers can connect them. Each transistor can essentially be switched on or off, which maps to zeros and ones – or the bits – in code that fuels the computer's processor.
Quantum computers use qubits, which are based on measuring the properties of subatomic particles, as their most basic element. At any point in time, a qubit can be either a zero, a one, or somewhere in between. This means qubits in a quantum computer can explore a far larger number of possibilities than the zero-or-one bits in a typical computer to find the most efficient answer to a math problem, resulting in its greater power and speed.
For D-Wave's computer to work properly and stop its qubits from interacting with other particles, its thumbnail-sized computer chip is cooled to temperatures of about minus 273.15 Celsius.
D-Wave's machines are spurring debate among researchers who question if they are truly quantum in operation. A paper published in 2014 found no evidence that D-Wave's technology solved a task faster than a traditional computer using quantum methods. Then a paper published this summer found that the D-Wave machine displayed some quantum characteristics.