Derivation Software was founded in 1996 by Richard Bray and David Perkins, soon to be joined by a third partner Laurence Porter.

Richard Bray had spent the previous 10 years as head of equity derivatives IT at ABN AMRO Bank and NatWest Markets.

Laurence Porter and David Perkins were lead developers on equity derivative risk and trading platforms at ABN AMRO Bank.

Derivation originally began its life as a convertible bond trading system and was built alongside convertible bond traders at a global German investment bank.

From here developed a very ambitious plan : to develop a fully comprehensive derivatives trading system, designed from the ground up to be able to process in real time tens of thousands of positions in multiple asset classes across all major markets :-

• Equity derivatives
• Fixed Income derivatives
• FX derivatives
• Credit derivatives

By the early 2000s it had become apparent that the growing hedge fund community was a new potential marketplace for such a system.

Rather than build a separate offering for the hedge fund community it was decided to extend the capabilities of the existing product to provide all the functions required by hedge funds in their trading operations including a full straight-through processing back-office capability.

The resulting work is now available as a fully integrated front and back office system.