HSBC and IBM have reported a significant advance in the use of quantum computing for financial services. In a recent trial, the two companies demonstrated that quantum computers can improve algorithmic trading in the European corporate bond market.
The experiment combined quantum and classical computing to predict the likelihood of winning customer inquiries in bond trading. According to HSBC, this approach delivered up to a 34 percent improvement over traditional methods using only classical computers.
Algorithmic trading in corporate bonds involves automated pricing models that factor in real-time market conditions and risk estimates. These models help traders manage large volumes of transactions efficiently. The trial showed that quantum computing techniques could better handle the complex variables involved compared to standard approaches.
The project used real production-scale trading data and tested it on multiple IBM quantum computers, including IBM Heron, which is currently IBM’s most advanced processor. This allowed the teams to validate their findings with actual market scenarios.
Philip Intallura, HSBC Group Head of Quantum Technologies, stated: “This is a ground-breaking world-first in bond trading. It means we now have a tangible example of how today’s quantum computers could solve a real-world business problem at scale and offer a competitive edge, which will only continue to grow as quantum computers advance.
“We have been relentlessly focused on the near-term application of quantum technology, and given the trial delivered positive results on current quantum computing hardware, we have great confidence we are on the cusp of a new frontier of computing in financial services, rather than something that is far away in the future.”
Jay Gambetta, Vice President IBM Quantum, added: “This exciting exploration shows what becomes possible when deep domain expertise is integrated with cutting-edge algorithm research, and the strengths of classical approaches are combined with the rich computational space offered by quantum computers.
“Such work is essential to unlock new algorithms and applications that are poised to transform industries as quantum computers scale, and the future of computing takes shape.”
Quantum computing uses principles from quantum mechanics to process information differently from classical systems. This allows it to address certain problems beyond the reach of even powerful supercomputers operating alone. In this case, IBM’s Heron processor was able to enhance existing workflows by uncovering hidden pricing signals within noisy market data.
IBM offers its quantum computers through cloud access using Qiskit software tools. HSBC Holdings plc is headquartered in London and operates worldwide across 57 countries and territories with assets totaling $3.2 trillion as of June 2025.
A multimedia pack featuring interviews with project leads from both companies and images from the trial is available for download at https://f.io/S-4v9Wk3.