NEW YORK • Nasdaq has agreed to acquire Sybenetix, a London-based start-up that uses artificial intelligence to help compliance officers at asset-management firms analyse the behaviour of their traders in order to prevent market abuse.

Sybenetix will enable the exchange group to expand its current market surveillance technology offering to service buy-side firms, Nasdaq said yesterday. It did not disclose the amount it intends to pay, but said the purchase price would be funded with cash on hand.

Nasdaq chief executive officer Adena Friedman has been vocal about investing more in innovative technologies such as cognitive computing. This deal is Nasdaq's first acquisition since her appointment in January.

Other than running stock exchanges, Nasdaq has a large division that sells market technology to trading firms, exchanges and clearing houses around the world. It runs a leading market surveillance software business, which includes a product called Smarts that helps brokers, exchanges and regulators identify potentially abusive trading across a range of markets.

More than 45 marketplaces, 17 regulators and 140 market participants use its surveillance tools.

"Our primary goal with this is our entry into the buy-side market with a compliance solution," said Ms Valerie Bannert-Thurner, senior vice-president and head of risk and surveillance solutions at Nasdaq. "We talk to firms globally who are looking at how they can beef up their surveillance and improve their compliance."

The acquisition will also enable Nasdaq to develop solutions that analyse data beyond trading records to better spot conduct risk, Ms Bannert-Thurner said.

BLOOMBERG