Intro
Get a better understanding of e-trading
FIX Engines are to financial applications what Web servers are to the Internet.
FIX engines are an essential building block for any firm specialised in electronic trading, otherwise called algorithmic trading or program trading. FIX plays a similar role as HTTP does in the web world. Here’s a description by the FIX Trading committee.
Like for Web applications, users expect excellent response times to stay engaged. In addition, low-latency is a must for investors who want to reduce market slippage. Some firms even specialise in Ultra-Low Latency trading, otherwise called High-Frequency Trading. They regularly execute over 100k transactions per second (i.e. 10µs period)
At this speed, human traders merely monitor the trading algorithms as timely observation of the order book becomes impossible. In these circumstances, advanced technologies are required
- Colocation
- Microwave network link
- Network kernel bypass
- Low-latency OS tuning, most OSes are not configured for this kind of workload out of the box
- A specialised FIX Engine like IdeaFIX !
Here’s an example of a running FIX client (Units are nanoseconds) :
