Originally used for exchange trading, co-location is now being embraced by the FX market but as Frances Maguire reports it is not only being used to lower latency but to create hubs to connect to the multiple ECNs and banks needed to trade FX.
The need to eliminate latency from execution first drove the equities and derivatives players to co-locate their servers near, or within, the buildings of the world’s exchanges. This is not as straight-forward for the foreign exchange markets, however, as there are a multitude of liquidity pools and execution venues to choose from and as a result a growing breed of new technology solutions are being built to offer managed application hosting, exchange connectivity or proximity hosting to the foreign exchange markets. ]FCM360 specialises in turnkey data centre solutions for traders and exchanges. This includes proximity hosting for high frequency trading, low latency trading, automated trading, algorithmic trading and exchange connectivity. It provides ultra low latency proximity hosting, co-location and connectivity to the major foreign exchange (FX) marketplaces for high frequency trading (HFT) and algorithmic trading by building its infrastructure in the same buildings as major liquidity pools, exchanges, crossing engines and low latency news feeds. These include marketplaces such as Thomson Reuters Dealing 3000, Currenex, Knight Hotspot FX, Integral, FXall and Lava FX, ICAP EBS, Gain Capital, major bank liquidity providers as well as Thomson Reuters Machine Readable News (News Feed Direct) and Need to Know News. Its client base covers trading houses, liquidity aggregators and software ISVs.