Complex Post-Trade Systems, Requirements Traceability and the Illusion of Control Iosif Itkin, CEO and co-founder Elena Treshcheva, Researcher

Exactpro Overview ● A specialist firm focused on functional and non-functional testing of exchanges, clearing houses, depositories, trade repositories and other financial market infrastructures. ● We provide software testing services for mission critical technology that underpins global financial markets. Our clients are regulated by FCA, Bank of England and their counterparts from other countries. ● We were part of the London Stock Exchange Group (LSEG) from May 2015 till January 2018. Exactpro management buyout from LSEG was successfully completed in January 2018. We are headquartered in the UK and have operations in the US, Georgia and Russia. ● Incorporated in 2009 with 10 people, our company has experienced significant growth and is now employing over 550 specialists.

We have a global Software Quality Assurance client network

Build Software to Test Software

Software Testing of Trading Systems Trading systems have very low latency (within hundreds of microseconds) ,... ...have significant throughput & capacity,.... …and they should be resilient, have the ability to recover from outages and have no single point of failure

Trading vs. Post-Trade Extreme testing challenges in high frequency trading systems pale in comparison to those presented by the post-trade infrastructures

Key Technical Challenges in Delivering Large Post-Trade Initiatives Challenges: A typical clearing system has highly complex features requiring high degree of accuracy and skilled resources: 1. Reference data; 2. Risk management; 3. The schedule (explained further in the presentation).

Key Technical Challenges in Delivering Large Post-Trade Initiatives (continued) ● The number of components of complex post trade infrastructures is very high; ● Upstream and downstream systems dependency; ● The participant structure is very complex; ● Trade/Xfer/Position/Account life cycle; ● The number of Asset Classes may vary; ● The complexity of the Risk calculation process; ● Access via a set of API endpoints. The challenges and their parameterizations lead to a significant number of test scenarios.

A Complex Post-Trade System During the Process of its Replacement

Congruence bias Confirmation bias Law of triviality Zero-risk bias Anthropocentric thinking Illusion of control Cognitive Biases Affecting Software Testing

Salman, I. (2016). Cognitive biases in software quality and testing. Proceedings of the 38th International Conference on Software Engineering Companion - ICSE ’16. Pp. 823-826.

Mohanani, R., Salman, I., Turhan, B., Rodríguez, P., & Ralph, P. (2018). Cognitive Biases in Software Engineering: A Systematic Mapping Study. IEEE Transactions on Software Engineering

Congruence Bias Direct Testing Indirect Testing Indirect Testing

Indirect Testing Methods Information extraction and Machine learning End-to-End Automated Test Library Whatever it takes! Test execution data and log analysis Passive Testing Whatever it takes!

Anthropocentric bias We should not humanize computers.

Anthropocentric bias They dislike it a lot!

Anthropocentric Bias: Testing a Mine-Defusing Robot

Anthropocentric Bias: Why We Treat Robots Like Humans Darling, Kate and Nandy, Palash and Breazeal, Cynthia “Empathic Concern and the Effect of Stories in Human-Robot Interaction” (2015). Proceedings of the IEEE International Workshop on Robot and Human Communication (ROMAN), 2015. 6 p. https://www.ted.com/talks/kate_darling_why_we_ha ve_an_emotional_connection_to_robots

Anthropocentric Bias and Software Testing

Ruthless and Cold-Hearted

ClearTH - An Innovative Way to Test Post-Trade Systems

Law of Triviality (the Bike-Shed Effect)

What is the Difference Between a Problem and a Catastrophe?

Zero-Risk Bias

Test Management Systems and Requirements Traceability

The Illusion of Control

The Illusion of Control and Happiness Sherman, G. D., Lee, J. J., Cuddy, A. J. C., Renshon, J., Oveis, C., Gross, J. J., & Lerner, J. S. (2012). Leadership is associated with lower levels of stress. Proceedings of the National Academy of Sciences, 109(44), 17903–17907.

Fenton-O’Creevy, M., Nicholson, N., Soane, E., & Willman, P. (2003). “Trading on illusions: Unrealistic perceptions of control and trading performance”. Journal of Occupational and Organizational Psychology, 76(1), 53–68. The Illusion of Control and Performance

Software testing is relentless learning, continuous improvement and keeping abreast of cutting-edge technologies. The research and development team at Exactpro uses machine learning methods of intellectual data analysis to create next- generation program analysis tools. We work in an agile environment collaborating with a multinational team of software developers. R&D Case Study: Cradle Test Database for Machine Learning

Applications of the Proposed Approach: https://unsplash.com/search/photos/san-francisco The First IEEE International Conference on Artificial Intelligence Testing (IEEE AITest 2019), April 4-9 2019, San Francisco East Bay, CA, USA User-Assisted Log Analysis for Quality Control of Distributed Fintech Systems Iosif Itkin, Anna Gromova, Anton Sitnikov, Rostislav Yavorskiy, Evgenii Tsymbalov, Andrey Novikov and Kirill Rudakov.

EXTENT - Software Testing and Trading Technology Trends September 17 Leadenhall Building, London, 2019 Join us in discussing the newest fintech trends and solutions to the challenges in mission-critical trading and post trade systems!

EXTENT - Software Testing and Trading Technology Trends September 17 Leadenhall Building, London, 2019 Join us in discussing the newest fintech trends and solutions to the challenges in mission-critical trading and post trade systems!

Thank you! Questions?