I am not a quantum physicist and far from the knowledge to assess the enthusiasm, challenges, skeptics ... the questions address "muscles" in my brain that I do not use often. And so it is even difficult for me to understand the the whole variety of possible applications.
I undertand that there is a provider: D-Wave and a customer: Lockheed Martin.
Reading a bit deeper I recognize that the massive quantum parallelism achieved through superposition opens a new dimension in parallel computing (quantum computers simultaneously operate "many" states).
This should also enable them to explore many paths in parallel. This seems to be extremely interesting to quant finance, as well as making say simulated annealing to solve minimization problems much faster.
I think of the achievements, barriers and traps related to calibration of complex volatility models and the implications to the valuation of exotic options.
It was fruit of our challenging and intense research to finding an optimization algorithm that delivers model parameters in seconds, check the robustness of the parameters and how to price the exotic options dependent on the chosen model (say, Normal Inverse Gaussian, Variance Gamma and Heston).
We found a clever combination of fast solvers for the forward problems, hybrid 4D/5D minimization and the usage of powerful computing muscles (hybrid CPU/GPU architecture, in concrete from transtec). We showed that the task, more than a million valuations are required, could be reduced from 8h (single CPU) to 8sec (on 12 CPU / 1800 GPU cores).
New requirements will force the reduction to milliseconds ....
Let us see how Quantum Computing will find its way into practice.
The D-Wave One system with a 128 qubit processor chip is housed inside a system within a 10 square meter shielded room.
A 2-3 training douse covers everything from physics of the computer to quantum software development - that sounds promising?
