Stock exchange real-time data engine will be first to test benefits of Windows 2003

The London Stock Exchange has been at the forefront of technical development since it moved from floor trading to electronic...

The London Stock Exchange has been at the forefront of technical development since it moved from floor trading to electronic trading in 1986, with major investment in IT infrastructure, trading systems and outsourcing contracts.

The exchange, the third largest in the world, believes future growth will come from the ability to sell more information services through the exploitation of cutting-edge IT systems. In fact, the exchange's latest IT initiative is so cutting-edge it is being named as one of the launch customers at Microsoft's Windows 2003 launch this week.

Last Monday the London Stock Exchange went live with a new datawarehouse and processing engine based on Microsoft's Windows 2003 Server.

The processing engine will allow the exchange to feed complex data from its trading system to its subscribers, via the new datawarehouse, in real time. This is a groundbreaking move, according to Mathew Wootton, head of information product development at the exchange.

"We are the first to load data into the datawarehouse in this way, in real time, as opposed to more traditional batch methods," he said. "This will allow us to use the datawarehouse for our own monitoring functions."

The processing engine will provide the London Stock Exchange with the capability to calculate and deliver a range of "value-added data" to subscribers, over and above raw share price information.

"Examples of the derived data we are planning to calculate centrally and provide to our customers are indicators relating to market liquidity, security risk and performance," Wootton said.

As well as improving the exchange's ability to offer a number of different information services to customers, Windows 2003 Server will increase internal efficiency, Wootton said.

"In addition to ensuring we can get data out to the market quickly, other reasons for going for Windows 2003 are its performance and scalability," he said. "It will give us a lower total cost of ownership. For our needs, it represents the most efficient and cost-effective solution."

The new corporate datawarehouse, from software firm Teradata, will give the exchange more control over the vast amount of information it deals with on a day-to-day basis, Wootton said.

"In addition to broadening our range of information products, we can consolidate six disparate datamarts [standalone databases] into Teradata," he said. "To maximise the value of the information you have to be able to access and analyse it from one source." The exchange also plans to use this information to develop its e-commerce business, Wootton said.

"We currently provide one or two [paid-for] services online, but we want to expand because there is a lot of value in the LondonStockExchange.com brand," he said. "We are the fourth or fifth most popular financial website in the UK and, if we can turn these 'hits' into revenue, it will be a boost for the information services business and the company."

Daniel Mayo, lead analyst at research firm Datamonitor, said the exchange's move would suggest that Windows is now seen as a more stable platform.

"It is a surprising move, as most exchanges would go for an enterprise-level platform such as J2EE, which has been seen as more stable," he said. "The key driver was probably Accenture [the exchange's IT outsourcing partner], which has a close relationship with Microsoft."

The London Stock Exchange has lagged behind in terms of datawarehousing, but the move to implement Teradata and Windows pulls it into line with rivals such as Euronext, Mayo said.

"The main advantages are cutting the cost of moving data and easing the collection of information," he said.The four-node Teradata 5350 datawarehouse is at the heart of the system. It acts a repository of trading information and uses hardware acceleration to boost performance. The hardware comprises eight 2.8GHz Pentium 4 Xeon processors, and a 5.5Tbyte Raid 1 fibre disc array from LSI.

Real-time trading data on an HP Himalaya Non Stop cluster is cached on the Windows 2003 real-time processing engine before being passed to the Teradata datawarehouse based on Unix. The Windows 2003 component comprises a four-node server running Microsoft's SQL Server relational database system.

The Windows 2003 servers perform further processing on the real-time data-feed from the exchange by converting the 70 types of transactions through the exchange into "value-added data", which is stored temporarily in SQL Server.

The Windows 2003 servers run an extract, translation and load process using Microsoft's OLEDB database middleware to move trading information into the datawarehouse. Four Gigabit Ethernet links connect the Windows architecture to the Teradata system.

The first phase of the project went live last week. The system is capable of handling 700 real-time messages with sub-three-second latency. With each transaction requiring approximately 200 bytes of information, real-time trades can be processed at a rate of 1.4 Mbytes a second. Reporting tools from Microstrategy provide internal users with access to the datawarehouse.

The 5350Teradata server has parallel processor architecture supporting up to 512 nodes. Each node comprises two 2.8Ghz Xeon processors from Intel. The nodes communicate with each other via an MPP interconnect called Bynet, which allows data to be transferred to each node at a rate of 120mbps.

In terms of the datawarehouse software Teradata uses, the MPP architecture breaks down database queries into smaller jobs that can be distributed across the nodes in the MPP architecture, resulting in faster processing times.

Ten years of IT at the London Stock Exchange

1993

Taurus, the planned automated transaction settlement system for the exchange, is cancelled after five years of failed development. Losses are estimated at £75m for the project and £450m to customers.

1994

The exchange goes live with the key phase in a complete overhaul of its ageing and complex computer systems.

Andersen Consulting (now Accenture) has been working on the overhaul since 1992 and plans to complete six phases of the new Sequence system by the middle of 1996.

The exchange introduces Sequence 3, which consolidates onto a common architecture system running on Digital Equipment and Data General machines.

1997

Sets trading system launched, jointly developed by Andersen Consulting, the stock exchange's main outsourcing provider.

2000

The exchange launches failed merger bid with Frankfurt stock exchange Deutsche Borse. The merger would have seen the exchange scrap its Sets trading platform and migrate to the German exchange's platform, Xetra.

2001

OM Group, a Swedish exchange and technology supplier, launches an unsuccessful hostile bid for the exchange. The exchange signs an £11m deal to supply the Sets platform to the Johannesburg Stock Exchange.

2002

The exchange rolls out anIP-based network to replace its ageing X-25 network. Half-year results show turnover from information services account for more than £50m.
This was last published in April 2003

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