[j-nsp] Qfabric

[Joel Jaeggli]

On 2/24/11 2:31 PM, Saku Ytti wrote:
> On (2011-02-24 14:59 -0600), Richard A Steenbergen wrote:
> 
>> latency in and of itself, just that you are "better than the other guy" 
>> so you can out-trade him). When it comes to microseconds of latency in 
>> the forwarding plane of a switch/router, I'm far less convinced that 
>> this is a real issue.
> 
> I've also argued about this, while I have no experience in high frequency
> trading networks. So it would be nice to hear from someone more experience
> how they capitalize on the low latency switches in high frequency trading.
> 
> It takes light about 5ns to travel 1m in fibre. Your average router MX80 is
> about 8000ns latency, low latency switch is under 1000ns.
> So we're talking for non low-latency run of the mill router introducing
> latency matching 1.6km of fibre and low-latency switch introducing 250m
> worth of latency.
> 
> Now where is this information going? How near physically is the end
> consumer of the information in high frequency trading?

the trading platform and the actors in question for a particular north
american market are located in the same facility in Mahwah New Jersey.

> What about the final application making trading decision? This is my own high
> frequency trading software, it is highly optimized:

> I have jitter of over 1000000ns between trading iterations. I'm guessing that
> real-life trading software is slightly more elaborate than this, and thus has
> higher jitter.

that activity can be simple as front-running large orders (which take
longer to fill) with small ones, an elaborate algorithm is not
necessarily a requirement. I'm kind of down on the market utility of
such activity but it's not presently illegal.

joel