Thoughts on low latency trading if exchanges went full cloud
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Thoughts on low latency trading if exchanges went full cloud
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Re: Thoughts on low latency trading if exchanges went full cloud
#2Nothing to add but I found this to be a well written thought exercise on a space I realize I know very little technical detail of. Thanks for writing this!
Re: Thoughts on low latency trading if exchanges went full cloud
#3Nothing to add but I found this to be a well written thought exercise on a space I realize I know very little technical detail of. Thanks for writing this!
Thank you. I'm only happy to hear this was helpful. I'd also love comments from any HDL quants about how portable FPGA code would be to virtualized environments and what other languages might stand out particularly well for a VM stack.
Re: Thoughts on low latency trading if exchanges went full cloud
#4Nothing to add but I found this to be a well written thought exercise on a space I realize I know very little technical detail of. Thanks for writing this!
Thank you. I'm only happy to hear this was helpful. I'd also love comments from any HDL quants about how portable FPGA code would be to virtualized environments and what other languages might stand out particularly well for a VM stack.
There are cloud FPGAs, but they are offered as a compute accelerators, and have no access to the network. Trading FPGAs need network access for latency.
Re: Thoughts on low latency trading if exchanges went full cloud
#5One key consideration is “provable fairness”. It’s my understanding that exchanges use techniques like long, same length fiber optic cables to all racks within the exchange datacenter to convince customers that everyone is on a fair playing field.
This is a lot harder to do when a server is virtualized somewhere on some rack on EC2. Exactly as mentioned, people will try to optimize by spinning up/down instances as close to the exchange server as possible. Customers will be unhappy because they can’t prove that it’s fair, even if they have the closest server.
Overall great, thought provoking writing btw
Re: Thoughts on low latency trading if exchanges went full cloud
#6Earlier quoted context omitted.
Thank you. I'm only happy to hear this was helpful. I'd also love comments from any HDL quants about how portable FPGA code would be to virtualized environments and what other languages might stand out particularly well for a VM stack.
There are cloud FPGAs, but they are offered as a compute accelerators, and have no access to the network. Trading FPGAs need network access for latency.
Im also sure that if theres enough customer demand (from people willing to spend $M), AWS will make network connected FPGA happen.
Re: Thoughts on low latency trading if exchanges went full cloud
#7I'm a total trading noob.
Can you explain why a low latency is worth so much? And how these traders "exploit" that advantage to make a profit?
Re: Thoughts on low latency trading if exchanges went full cloud
#8About the market data & monitoring element, beyond the usual suspects Clickhouse and kdb+ - worth noting that Aquis mentioned in this article uses QuestDB ( https://questdb.io/case-study/aquis/)
Re: Thoughts on low latency trading if exchanges went full cloud
#9... is there some movement toward "upload the strategy and let the exchange run it"? which would provide a more level playing field, reduce energy and hardware costs, etc?
Re: Thoughts on low latency trading if exchanges went full cloud
#10Nice article. Wondering though why trading is not done in discrete batches, e.g. 5 second intervals? Trades in the same interval get filled equally or stochastically? Info about trades with that same 5 second batch delay? Is there some (theoretical) market efficiency thing at play? All this HFT feels wasteful and bad for 'regular' human investors.