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Trading speeds race breaks news ground

Karl Flinders

The UK now has a trading technology capable of completing a trade in 16 millionths of a second, following the arrival of specialist supplier Algo Technologies.

The company's Algo M2 trading software has been measured as being able to complete a trade, from a customer making an order to an acknowledgment, in 16 microseconds (0.016 milliseconds).

One microsecond is one millionth of a second.

Multilateral trading facilities such Chi-X and Bats have increased the performance and speed of their trading systems, putting other companies under pressure.

For example, Chi-X and Bats can complete trades in 400 and 200 microseconds respectively, compared with Tradelect's 3.7 milliseconds per trade.

Hirander Misra is CEO and co-founder of Algo Technologies. He was formerly chief operating officer at Chi-X Europe, which has already grown a large share of the trading market with its sub-millisecond trading platform.

Algo Technologies said the software system can process an order internally in 500 nanoseconds and has the mathematical capacity to process two million messages per second on a single matching engine.

Algo M2 will be available under license to trading firms on 24 May, when Algo Technologies' global exchange services business is launched.

Misra said existing systems are out of date as a result of the speed of change in the sector. "Many legacy exchange systems are up to 20 years old while most of the current fastest trading engines date back from design principles introduced in the US well over 10 years ago," he said.

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