Connecting to Hundreds of Trading Platforms Made Easy
Fixed income trading is moving to electronic channels, and with the introduction of MiFID II in Europe, this is trend is accelerating and the number of trading venues keeps growing. For firms to access those markets high speed integration is needed, not just for message flow but for switching on each new market as liquidity grows. The challenge for trading firms is to connect to multiple venues without spending a fortune, and to achieve high speed reliable messaging at all times. To connect to these venues in an ad hoc way, firms would need to gain access to the documentation for each API at each venue (often more than one API), develop in a test environment and then connect to the live platforms.
TransFICC provides an operational service which manages connectivity to each venue. Trading firms connect to the TransFICC API, which integrates and connects to all the supported venues. In providing this operational service TransFICC take ownership of change management, when a venue plans changes to their API, TransFICC ensures these changes are made and tested, ready for live operations.
It is thought that there are now over 130 trading venues in the world, which between them provide 230 APIs, with more coming. Keeping up with this torrent of change is only possible for the largest firms, hence the business case for TransFICC to solve this problem. Secondly, once connected to these venues, the flow of messages can approach between 2,000 and 5,000 items per second - per venue - in a volatile market. Multiply that by 230 and your systems will find themselves overwhelmed with data updates.
Anyone who’s been part of building a message based multi-processing systems architecture will realise that typical message handling and distribution soon struggle at high message frequencies. TransFICC has adopted three key technology approaches to underpin their platform:
- Simple Binary Encoding (SBE): Anyone who’s looked at XML such as FIX or FpML will realise that whilst they are readable by humans, that doesn’t make for a compact and efficient message size. SBE takes binary data from venues and keeps it in binary as far as possible, leading to smaller messages and higher transmission rates.
- Aeron for transport: UDP and TCP were designed for slower communication over longer distances. Aeron is a UDP message transport that is faster than TCP and adds reliability to UDP.
- Disruptor inter-thread messaging: Once messages are flowing, how they’re distributed can also cause traffic jams. A typical queue and buffer approach brings bottlenecks when what is wanted is a highly parallel non-blocking approach, hence the adoption of Disruptor with ring buffers.
Finally TransFICC understands the need to iterate its platform as fast as the markets change. They have adopted a continuous delivery, build and test approach with automated acceptance testing. If tests fail, coding stops until the platform (in development) passes the tests again. They then test the platform against UAT environments for the many venues, meaning they can update production every two weeks.
If your firm is faced with the challenge of e-trading connectivity, check out TransFICC:
- Standard API across venues
- Hosted operational service for high speed and reliability
- Continuously updated to remain up to date
- Designed for maximum speed and reliability
- Save money by adopting a single integrated API
Currently 2 banks are using the service in pilot mode with 11 more in testing. For more information visit https://transficc.com