Participants in the low-latency race are no longer content to stay wedded to ground-based fiber technology. Now, US equities markets can be connected literally through the air via microwave technology.
Today, CFN Services, a provider of automated trading enablement services, and xCelor, developer of a FPGA-based device called Market Feed Handler (MFH), have partnered to provide a microwave market data delivery and trade execution solution for US equities markets, named the Alpha Platform.
According to the vendors, microwave is emerging as a new technology for connecting key liquidity venues in the US equities, options and futures markets within and between New York and Chicago. While microwave transport technologies offer the advantages of lower latency versus traditional fiber transport, there are a number of limitations including bandwidth which xCelor and CFN Services have claimed they have addressed.
"There has been a lot of buzz as well as misinformation around the deployment of microwave," said Mark Casey, President and CEO of CFN Services in a press release. "Microwave holds considerable promise as an emerging low-latency technology, but its complexity is a level beyond fiber. We've partnered with xCelor to reduce the complexity and cost of using microwave for market data delivery and trade execution."
The technologies for microwave transport are different than fiber, according to the technology providers. Even within the microwave transport domain, different technologies and radio frequencies (RF) are necessary for connecting trading venues within the trading markets of New York and New Jersey, compared with connecting those markets to Chicago, Toronto, or other distant markets. The Alpha Platform leverages embedded proprietary technology from xCelor to support simultaneous active data paths and manage the failover from microwave to fiber ensuring consistent data delivery at the absolute best latency, according to the press release.
"We've built our market feed handlers on the latest Altera FPGA technology and proved them out in some of the most demanding HFT environments," said Robert Walker, CTO of xCelor. "We're excited about our partnership with CFN Services to leverage the next generation of our technology to enable microwave based DMA on the Alpha Platform."
The xCelor MFH technology is currently in production on the four major US electronic equities markets, with the Chicago markets slated for the second half of the year.