Originally published to Data Center POST
By Rob Ruehle, Vice President of Operations, Liquid Technology
Although computers entered the financial services sector as early as the 1960s, it was the advent of the internet and low-cost computer hardware in the ‘90s that fueled the emergence of all-electronic trading platforms. Fast-forward to today, and a financial system that began with mainframe computers has become a digital information ecosystem that is increasingly reliant on such next-generation technologies such as Artificial Intelligence, Big Data algorithms and cloud. To keep up, firms that engage in high-frequency trading (HFT), must regularly invest in new tech equipment to be at the top of their game and remain competitive in an industry where optimum technology performance and speed are the key drivers of their success.
The International Data Corporation (IDC), a provider of market intelligence and advisory services, has found that old and inefficient computer technology and network infrastructure causes a decrease in productivity and an increase in security risks. Moreover, older technology is more likely to break down, increasing the risk of downtime. Legacy technology is also more difficult and costly to maintain, and in many cases can’t deliver the performance and advanced features that newer technology provides, which can create a competitive disadvantage. In fact, the emergence of cloud technologies and an increase in the adoption of private, hybrid, and public cloud in the financial sector, including trading environments, has accelerated the need to reduce IT equipment on premise.
In the world of HFT, the discipline is all about speed. The process for HFT is one that uses advanced algorithms and computer programs to automatically analyze the market and execute the best transaction at the fastest speed. Speed and performance are expensive propositions and yet new equipment and IT solutions are the only way to acquire more of it.
To read the full blog, please click here.