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Reduced latency is winning the war against stale prices

Rapid Addition > Electronic Trading Platforms News and Events > Opinions > Reduced latency is winning the war against stale prices

FIX engine platform vendors must continuously improve performance if they are to keep meeting clients’ demands, says Rapid Addition Chairman Kevin Houstoun.

Disseminating millions of quotes per second to an ever-increasing audience demands a huge amount of innovation and investment.

Yet it is the only way to stay ahead of the pack and remain a reliable FIX Engine platform partner in an increasingly competitive trading environment.

Key to this is speed and performance, all geared towards reduced latency and fewer stale prices.

For example, innovations in code efficiency leads to faster response times. Yet it also has the benefit of reducing server load, meaning fewer servers and lower running costs for the business.

“We’ve got a number of large Tier-one banks who’ve deployed our product RAHub to help them with price dissemination,” says Kevin.

“What you see in a typical FX shop is you have two areas where RAHub can be deployed. You have price aggregation, so they listen to all of the alternative liquidity pools, get the prices from there and understand what the market’s doing.

“There is then an Algo, which is obviously proprietary to the bank. The bank uses it to determine what price they want to then offer their customers. Then there is the problem of getting that price disseminated to all of their customers.”

“RAHub is very efficient at doing this, and we see a large number of banks deploying it in that exact use case scenario.”

Full software infrastructure partnership

Rapid Addition began life 15 years ago as a FIX engine vendor. They rapidly identified that performance was very important to their customers, both in terms of throughput and latency.

Then, about 5 years ago, they started a business strategy of moving from being just a component vendor, to becoming a complete platform vendor.

“What we’re now able to do is the software infrastructure that you need to run your electronic trading business, be that fixed income equities or FX, price dissemination – which we’re talking about today – particularly for the FX space,” says Kevin.

“For algos to decide on what you’re going to make those prices, how you’re going to make those prices, which customers you are going to offer those prices to; matching engines, Smart Order Routers”

“What we don’t do, which is almost as important as what we do, is we don’t compete with our customers, we don’t do the intellectual property behind the algos or the order routers.”

RA Hub and the RA Open API have been able to significantly exceed initial requirements for speed and through put for the dissemination of price updates.

For more information on how RA can benefit your organisation, visit our RA Hub page or call us on +44 (0)20 3868 9161 or email enquiries@rapidaddition.com

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