Strategic Intelligence: Deep Dive into Quantum Computing in Financial Services

Strategic Intelligence: Deep Dive into Quantum Computing in Financial Services

Summary

Quantum computers are machines that use the properties of quantum physics to store data and perform computations. Quantum computing in financial services, or quantum finance, is an emerging field that integrates principles from quantum physics and quantum computing with financial services to solve complex problems more efficiently. It uses the unique properties of quantum computing, like superposition, interference, and entanglement, to potentially revolutionize areas like risk management, derivatives pricing, fraud detection, asset valuation, and financial crash forecasting.

Key Highlights

• Machine learning and generative AI are already widely used by financial services companies. The addition of quantum computing will enhance the performance and quality of financial algorithms, enabling them to solve complex problems more effectively. Problems will need to be framed in quantum-friendly architecture to capitalize on the power of quantum.
• With the continuous improvement in the scale and reliability of quantum computers, the industry is moving closer to true fault-tolerant quantum computing. Tools like quantum machine learning will be implemented in practical applications within 10 years.

• This report analyzes the potential impact of quantum computing on financial services. It looks specifically at nine financial services use cases: arbitrage detection, complex derivatives pricing and risk analysis, estimation of economic capital requirements, convex portfolio optimization, financial product recommendations, credit scoring and credit risk, fraud and anomaly detection, quantum safe key transmission, and predicting financial crashes.

• Quantum computing could revolutionize the financial services industry by solving problems intractable for classical computers. This report takes a deep dive into this subject, highlighting use cases for quantum computing in financial services and identifying the most relevant algorithms.