Somone explains if there is ultra low latency for for ex aka FX spot markets for DMA

(Last Updated On: September 23, 2010)

Somone explains if there is ultra low latency for for ex aka FX spot markets for DMA

This was part of a discussion in a Linked In group:
No network latency is eliminated in any market, which is important to understand. Even for co-located clients who are trading on the LSE, Euronext etc, they will still have cross connect latencies, along with latency going through their stack of hardware. This is also prevalent in the FX market. Fixnetix can improve latency on the cross connects inter data centre to around 0.02ms from hosted engine/cab to the FX venues pop.

FX Updates:

EBS: EBS Live sends 10 updates a second time sliced in to 1 update every 100ms. EBS Ai sends 4 updates a second time sliced in to 1 update every 250ms. The updates moves randomly, so in essence you could receive 14 updates per second if you take both offerings.

Reuters: is delivered over Radianz which introduces a lot of latency which we know as we helped a large HFT house with Corvil probes to understand that it was the Reuters lines and Firewall that introduced latency.

Currenex: updates are tic-by-tic and has more liquidity than HotSpot, and less than EBS / Reuters so again the updates may be less valuable.

HotSpot: updates are tic-by-tic….Not as much liquidity as on Currenex / EBS & Reuters so the updates could be less valuable.

FXCM Pro: updates are tic-by-tic and has less liquidity then the professional market but has a very large retail base, small stuff.

FXall: I believe that updates are tic-by-tic as HotSpot, FXCM Pro and Currenex. Waiting for this to be confirmed.

I believe that all single bank platforms are tic-by-tic, and the latency cannot be eroded as most of their matching engines are located in-house. This is being looked at, as we are in discussions with a number of banks about re-locating their price engine….

What is important to understand is the credit access that an individual trading entity would have to an ECN’s liquidity. Unless you have credit with everyone then you may not see all tradable prices. If the market is showing 20/22 and a bank offers at 21, unless you have credit with that bank you will still only see the 22 offer.

Feel free to shoot me an email at karen.bertoli@fixnetix.com and I will be happy to connect you with the right people. Best,

NOTE I now post my TRADING ALERTS into my personal FACEBOOK ACCOUNT and TWITTER. Don't worry as I don't post stupid cat videos or what I eat!

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