FOREX TECHNOLOGY
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you have transparency over latency and that you can rely on when heavy trading is taking place.”
“Recently, we’ve seen a shift to market participants opting for dedicated point-to-point circuits from fibre providers like euNetworks, Abovenet, Algospan and others to reduce latency and increase predictability of round-trip delays,” he continues.
Network provider euNetworks says it has seen up to 30% of its recent growth driven by low-latency services.
“In most cases the large banks we work with are using the connectivity within their own trading strategies. A lot of the smaller traders that may buy more of a managed service tend to go through a reseller or a systems integrator. By providing ultra-low latency connectivity to resellers and system integrators, we are able to service the wider community,” says Selby. “We’re focused on differentiating ourselves in the market, delivering the best service possible,” he continues. “We do this by building our ultra-low latency euTrade network in a way that ensures nothing is extraneous. Whether it is a cross-connect or a fibre spool, it all adds up even if it adds just one or two microseconds. Our euTrade dedicated network is built on Layer 1 DWDM infrastructure. Tere is no legacy technology. We don’t contend any of our services, so if a customer buys a 1G or a 10G service, it is delivered on a dedicated path, providing reassurance to our customers of a consistent and reliable ultra-low latency solution.”
Schwartz says that changing customer demands mean his firm has to adapt to the requirements of particular client segments, and also the changes in data traffic that occur throughout the day.
“We offer an enormous amount of flexibility; often services are customized, based on the customer’s needs ranging from simple to complex multi-location designs. We’ll deliver a fast cross-connect at a data center if that’s all they want, or design a sophisticated deployment integrating their internal network to our network. Te bandwidth and design is determined upon overall usage and speed requirements. We provide flexible, guaranteed bandwidth, to destinations. For example, we offer bursting services to assure stable data flow. Tis is particularly helpful in unpredictable data environments such as market data. Bursting, large amounts of bandwidth, based upon changing trading characteristics are a critical need for FX clients”
86 | july 2012 e-FOREX
Gary Dennison
“With HFT systems and algos increasing their messaging, coupled with greater volatility in the FX markets, speed of execution is more important now than ever before if you want to gain an edge in trading.”
Getting the measure
However Schwartz also warns that the full range of latency options are only possible if a firm can monitor its performance, so monitoring tools are key. Tese are used both in-house and also provided to customers who want to have visibility over their network. Although the client would not necessarily manage it, if they are able to view it and see how they are trending, they can make further decisions about capacity requirements based on the level of bandwidth they are using as trades take place.
To monitor latency effectively a firm needs to have equipment that sits at both ends of a connection. Te ability to make that happen will depend on the architecture it has; whether it uses an outsourcing provider, whether a third party is at the other end of the connection is going to permit equipment to be attached. In some cases it may be a trader is working between the firm’s own offices in multiple locations, giving full access, in others the firm may only have access to what is happening at its own end.
“Starting with the outsourced model the obvious question is how do you know what is being introduced
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