TearSheet Podcast: Goldman Sachs’ Zeng and IBM’s Woerner Discuss Quantum Computing’s Potential Impact on Financial Services

(TearSheet) IBM’s Stefan Woerner and Goldman Sachs’ Will Zeng were interviewed on this podcast to discuss some of recent findings they’ve made in quantum computing’s ability to address derivative pricing and more broadly, to talk about the technology’s potential impact on financial services.
Zeng addressed the need for quantum computing in modern finance. “One of the reasons that finance is so exciting for applying new kinds of commercial computing technologies is that we have a lot of mathematical problems that are pretty easy to specify and that there’s been a lot of incentive to work with classical computing hardware, non quantum. The old generations of hardware have been optimized aggressively in a lot of cases. So there’s a real need for new thinking.”
There are three broad categories that Goldman Sachs is looking at right now. The first is in what I call broadly simulations. The second is optimization. There are a lot of hard optimization problems across financial services, portfolio optimization being maybe the most obvious one. The third category is machine learning. And here, there are applications in trading, but there’s also applications in things like anti money laundering, or avoiding fraud.
Zeng explained: “When Stefan and I started, quantum computing was just a thing that some academics and some deep research groups like IBM did. Now, there’s been more than $20 billion of global government public research funding announced over the last few years. Venture capital has invested almost $1.5 billion into the space. The growth and trajectory is really encouraging. We see a lot of innovation happening.”
Woerner spoke about IBM: “We are building an ecosystem around quantum computing. We’re making this accessible through our IBM quantum network, where we already have 100 plus partners and members, and all of them can access this. We even have quantum computers available through the cloud for free to the public. But those are not the premium devices. So I think building the ecosystem and having access through the cloud to a large group of users is very important for multiple reasons. Particularly in the process of getting to useful applications, we really want and need a variety of people that look into what can be done with this, that look into it from completely different angles and industries, and help to grow this.”