Glossary
The vocabulary behind operational AI and trading automation, defined in plain English. No marketing, just the terms you will meet on a desk and in a procurement review.
- Operational AIthe category
- AI that completes a business action inside live systems, under defined rules, not a model that only generates text or suggestions. The test is whether it can act, and whether the action can be accounted for afterwards.
- RFQrequest for quote
- A request sent to one or more liquidity providers asking them to quote a price for a given instrument and size. Comparing several RFQs is how a desk finds the best available price.
- FIX Protocolfinancial information exchange
- The messaging standard the industry uses to send orders, quotes and trade confirmations electronically between counterparties. A "QuoteRequest" message, for example, carries the tag
35=R. - REST APIapplication interface
- A widely used way for software systems to exchange structured data over the web. It is how a modern platform reads and writes records in another system without a human in between.
- Settlement exceptiona break
- A problem in the settlement process, most often a mismatch in instructions, that has to be resolved before a trade settles. Left unresolved, an exception becomes a costly failed trade.
- IOIindication of interest
- A non-binding signal that a participant may want to buy or sell a security. Desks use IOIs to test appetite before committing to a firm order.
- Deal capturebooking a trade
- Recording the agreed terms of a trade into systems as a clean, validated record. Done by hand it invites transcription errors; done well it is fast and lossless.
- Audit trailthe record
- A chronological, tamper-evident account of every action, decision and message. It is what lets you demonstrate, after the fact, exactly what was done and on whose authority.
- Human-in-the-loopa control
- A pattern where a person must review or approve an automated step before it proceeds. It keeps speed and judgement in balance for sensitive actions.
- Hallucinationa failure mode
- When a model produces confident output that is wrong or invented, not grounded in real data. In execution, the antidote is to check against your own records before acting.
- Straight-through processingSTP
- Handling a transaction electronically from start to settlement without manual re-entry. The fewer the hand-offs, the lower the operational risk.
- Financial middlewarethe plumbing
- Software that sits between front-office tools and back-end systems, translating and routing requests between them, the layer where Emmie lives.