Forex Lowers Latency By Upgrading Its Messaging Platform

Foreign exchange brokerage Forex Capital Markets had to reduce data latency to less than one second. Its answer lay in adopting multicasting and deploying a new messaging solution from 29West.

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As the markets grow ever-more electronic, the focus on latency intensifies. At Forex Capital Markets, a foreign exchange brokerage that handles 100,000 trades a day for both institutional and private investors, for example, 15 seconds to 20 seconds of market data latency was acceptable just three years ago, according to Alexander Ryssiouk, the firm's director of development. In 2006, however, the latency threshold dropped to less than 1 second.

"Today, our goal is even higher," relates Ryssiouk. "We're talking about 10 milliseconds for delivering market data [to clients]."

Noting that trade volumes for Forex Capital Markets have been doubling every year in recent years, Ryssiouk points out that latency and scalability issues go hand in hand. The firm not only must be able to handle large spikes in the market, he says, it also must provide fast execution to its customers.

Adopting a multicast protocol has helped, as has upgrading the firm's network to a 1 gigabit Ethernet, according to Ryssiouk. But most effective of all, he says, has been the deployment of a new low-latency messaging solution from 29West. Since installing the new messaging software, latency for market data delivery has dropped to a negligible 10 milliseconds, Ryssiouk claims. The next step, he adds, will be providing execution through the new technology.