LSE Breaks World Record In Trade Speed With Linux 452
LingNoi writes with this excerpt from ComputerWorld UK: "The London Stock Exchange has said its new Linux-based system is delivering world record networking speed, with 126 microsecond trading times. The news comes ahead a major Linux-based switchover in twelve days, during which the open source system will replace Microsoft .Net technology on the group's main stock exchange. The LSE had long been criticised on speed and reliability, grappling with trading speeds of several hundred microseconds. The 126 microsecond speed is 'twice as fast' as its main international competitors, the London Stock Exchange said. BATS Europe and Chi-X, two dedicated electronic rivals to the LSE, are reported to have an average latency of 250 and 175 microseconds respectively. Neither company immediately provided details. But many of the LSE's older and more traditional rivals offer speeds of around 300 to 400 microseconds. Nevertheless, Linux is now standard in many exchanges, including the New York Stock Exchange."
I love this "Ad" by Microsoft: (Score:5, Informative)
http://www.youtube.com/watch?v=BwSM55bsCrM [youtube.com]
I could watch it over & over... It puts a smile on my face... :)
http://news.cnet.com/8301-13846_3-10036286-62.html [cnet.com]
Cheers... Clark
Re:Not just useless, but actually toxic. (Score:5, Informative)
It is the time measured from when a bid/ask order is sent from the customer's network port, until it has been processed/stored and possibly matched at the Exchange, and back again.
Re:Light (Score:1, Informative)
That is exactly what they are, the land prices around the servers in New Jersey has sky rocketed as trading corporations are buying land as close to the servers as they can possibly do in order to gain an advantage over their competitors. This whole millisecond trading is ludicrous and I am sure it will result in a next big bubble as the price is not based on any real evaluation of the corporation traded.
Re:Light (Score:5, Informative)
Yep, and major trading firms will do anything to get closer to the exchange servers. I worked for a Major Bank which had a major data centre well outside London which hosted all the "slow" apps, and a small (but well cooled) server room in the City a few blocks from the LSE building. Each and every app in the central data room had to justify its need, and every so often you would hear about acquisitions of real estate closer still.
This is of course pre-2008; I'm no longer so intimate with the details of server rooms at major banks. C'est la vie.
Re:Not just useless, but actually toxic. (Score:5, Informative)
while in theory your idea is correct, the harsh reality is that in practice, the large investment firms increase their profits drastically because there are actually two markets. this isn't strictly legal, but it's there. the large firms have dedicated connections to the exchanges with guaranteed SLAs and lower latencies than any other regular participant in the market. this allows them to stuff the buy/sell queues and rapidly cancel orders before they go through. the purpose of this is to deduce other bidders' price points and gain an edge. there are a number of such hedge funds (and even a major bank whose name escapes me), for example, that have had perfect trading days for over a year. statistically impossible outcomes like this only come from gaming the system in the above mentioned manner. as usual, the regulators are asleep at the wheel and the markets become more volatile week to week with increasing flash-crashes exactly because of these schemes. more efficient markets these are not.
Re:Not just useless, but actually toxic. (Score:3, Informative)
Trading this fast brings the market closer to optimal economic efficiency, where prices at any instant accurately reflect value. Latency contributes to the very inefficiencies that you blame these "large investment firms" from profiting off of.
The faster the trades, the greater the disparity between how fast a normal Joe investor can trade vs. how fast an investment firm plugged directly into the exchange can trade. Let's say I'm down the block and my ping times are an awesome 6 milliseconds. A large investment firm plugged into the exchange might have a ping time of 1 millisecond (I'm being quite conservative here), even 1% increase in benefit I see the investment firm is going to see a 6% benefit.
Yes, they play a role in equalizing market prices (more power to them) but they can also profit from the fact that ordinary investors are acting on information that is outdated because they are unable to receive the information as fast as the large institutions can. The greater trading speed only increases this disparity.
Re:Wait up zealots. (Score:3, Informative)
Why oh why do people have a need to spread reverse FUD and give "linux" props it does not deserve?
Because Microsoft highlighted the TradeElect system in their "Get the Facts" campaign. Oddly enough, if you read the press kit Microsoft put together, you'd get the impression that a recent version of Windows and an optimised application was in place and doing very well. Maybe Linux does get some small slice of kudos after all.
http://web.archive.org/web/20070706203521/http://www.microsoft.com/windowsserver/facts/casestudies/lse.mspx [archive.org]
speed is counterproductive (Score:3, Informative)
One shouldn't forget that these high speed tradings are not in the interest of investors, companies being traded or other market participants with a real-world interest. They serve only the high-speed/high-volume speculative traders, specifically algorithmic or automated traders.
Even Wall Street is slowly waking up to the problem:
http://online.barrons.com/article/SB50001424052970203952604575552190237324972.html?mod=BOL_twm_mw [barrons.com]
This was a bomb about a week ago when it was published, the guy making those statements is a Wall Street billionaire, not a hippie communist.
Re:Not just useless, but actually toxic. (Score:1, Informative)
Just from some quick Googling:
100% perfect trading streak [istockanalyst.com]
61-day perfect run [nytimes.com]
There are some in-depth analyses of the "Flash Crash" recently, for instance at:
Flash Crash Analysis [nanex.net]
Re:Linux: 1, MS: -1 (Score:5, Informative)
Well, obviously the LSE wanted a real-time system and Accenture and Microsoft used .NET, which was a total failure on their part. You cannot do real-time with .NET - Idjits...
Then on top of being dog slow, it fell over, costing the LSE a ton of money. So they probably implemented it with an Access DB and Exchange mail server as well.
So, MS touted this as a major win and then fell on their asses.
1. Euphoria:
http://web.archive.org/web/20080303191622/www.microsoft.com/casestudies/casestudy.aspx?casestudyid=51828
2. Reality:
http://blogs.computerworld.com/london_stock_exchange_suffers_net_crash
3. Tux to the rescue:
http://www.computerworlduk.com/news/networking/3244936/london-stock-exchange-smashes-world-record-trade-speed-with-linux%22%22
4. The dead cat bounce?
http://moneycentral.msn.com/investor/charts/chartdl.aspx?symbol=MSFT&CP=0&PT=11
Re:Not just useless, but actually toxic. (Score:5, Informative)
Themis Trading has a white papers on the kind of information HFT algorithms get to play with (for a fee of course, the exchanges want their cut).
http://blog.themistrading.com/?p=906 [themistrading.com]
PS. some of this is being addressed at the moment, but it shows where the real money in HFT is coming from ... and it sure as hell isn't being better at price discovery.
Re:Not just useless, but actually toxic. (Score:3, Informative)
the part where it's running on a mainframe?
(Yeah, I have no idea whether the stock exchange has anything to do with mainframes, but I know you can put linux on 'em)
Re:Not just useless, but actually toxic. (Score:4, Informative)
No, i'm talking about the hours of downtime that the previous system experienced [telegraph.co.uk] (my bad 7 hours not 8). It was a simple fact (get the facts haha).
When one of the numerous Linux exchanges goes down for that long then call me.
Re:Offtopic - for gods sake why?!@ (Score:3, Informative)
Go into your preferences and turn Discussion 2 off.
There is a bug in Slash that means (or at least a week ago, meant) that the settings don't always save first time so you may have to try a couple of times.
I agree, Discussion 2 sucks (it uses masses of CPU time and any discussion with more than a couple of hundred comments requires an 8 core system to merely run at a snails pace). I wasn't all that pleased they turned it on for me when I've had it switched off, I've got rid of it now.
Re:Not just useless, but actually toxic. (Score:5, Informative)
It's not only updating tables...
The exchange gets a cut of every sale, so at the very least, the more sales you have the more you can profit.
It's more insiduous than that though. Between the price a buyer wants to pay and a seller wants to receive, there's a certain spread. Faster trades allow the exchange to take advantage of that spread. Sometimes it lasts a second or so, but trading volume means a second can make thousands of dollars.
Faster exchanges also allow 'tasting'. The average investor doesn't get to take advantage of it, but the large houses do. They can float a price out there and see how many people are willing to buy at that price. Then they can test a higher price... Then higher.. At some point they reach a price that maximizes their profit.
It also means that certain brokerage houses can get their trades in faster. So that means a popular and rising stock goes to those houses that pay for the privilege of first dibs. These houses can then set the price on the stock.
There are dozens of other ways that faster trades help.... Of course, none of it helps us, the average stockbroker.
Re:Not just useless, but actually toxic. (Score:2, Informative)
Re:Not just useless, but actually toxic. (Score:5, Informative)
Actually what is most disgusting is:
When those algo/HFT systems have bugs or lose big
a) the stock market rolls back the trades[1]
b) the small timers beating those algorithms get sued.[2]
But they don't do that when the small timers make mistakes or the algo/HFT systems beat the small timers.
Even though many of the HFT bunch are doing dubious stuff:
http://www.nytimes.com/2009/07/24/business/24trading.html [nytimes.com]
http://www.nytimes.com/imagepages/2009/07/24/business/0724-webBIZ-trading.ready.html [nytimes.com]
[1] http://www.reuters.com/article/idUSTRE6456QB20100507 [reuters.com]
[2] http://www.computerworlduk.com/news/security/3244186/norwegian-traders-convicted-for-outsmarting-us-stock-broker-algorithm/ [computerworlduk.com]
Re:Best for headshots (Score:2, Informative)
The expensive fans are more of an overclockers toy than a gamers. Like everything else in life, you get what you pay for. Cheap fans usually have terrible sleeve bearings, are very loud, and the sleeve bearings will die out within a year of usage. Also, the heatsink usually tends to be more expensive than the fan itself and is just as important if not moreso. You may be confusing the two.
As far as expensive mice go, it's an issue of ergonomics and precision. My space ball that I use for 3D CAD modelling cost more than any expensive gaming mice I can think of and that also has to deal with ergonomics and precision.
"Oxygen-free-cable" I have no idea you're referring to.
Re:Best for headshots (Score:3, Informative)
WoW client works fine under wine (tad better than under Windows imho).
Really? And what is the major improvement/difference, besides running under wine/in linux?
Swap performance and VM handling, frankly. It's better at not putting things in swap it shouldn't, and quickly getting things off swap it needs. Generally less lumpy if you aren't swimming in memory like I'm not.
I also get the added benefit of instantly switching in and out of the game with virtual desktops, and being able to shut down all unnecessary systems and programs, and SIGSTOP/hibernate large things like firefox so they sink entirely out of memory until I call them back, and I have total scripting and file control over all my addons and logs and things.
Also, crashes won't take out the box, and if things get really gnarly, I log in behind my GUI remotely and shoot things. For some games that are going under due to game corruption, flicking to the CLI, Kill, restart, can get the game back before the server has given up on your connection. WAY faster than Windows.
Re:Best for headshots (Score:2, Informative)
Re:Best for headshots (Score:3, Informative)
Like everything else in life, you get what you pay for.
When anyone says that to me I hang on to my wallet for dear life. If you buy those expensive digital cables for stereo, you are NOT getting what you paid for -- you've been scammed. When you pay $100 for a pair of blue jeans, you're also being scammed. When you pay three times for a bottle of Alieve what you would pay for a bottle of generic naproxin sodium, you're getting scammed. In none of these instanced are you getting what you pay for.
You do, however, usually (but not always) pay for what you get. When you buy an overclocking fan, you are paying for what you get provided it really is a superior fan. When you buy Alieve you're paying for what you get, plus some. All you're getting is naproxin sodium, no different than the generic that costs 1/3 as much.
Re:Faster than "ping localhost" (Score:1, Informative)
Re:Not just useless, but actually toxic. (Score:1, Informative)
Funny looking at that map.
Not half as funny as this one [wikipedia.org]
Re:Not just useless, but actually toxic. (Score:5, Informative)
Describing this as getting sued for outsmarting an algo is pretty misleading. The traders in question did find some flaws in the algo, but rather than exploiting them directly to profit from the algo machine, they used the algo to manipulate the market as a whole, so they could profit from that. They understood what would happen when they started manipulating the algo, and they should have understood that market manipulation of this kind illegal.
Misleading? Illegal?
Go see one of the links I posted: http://www.nytimes.com/2009/07/24/business/24trading.html?_r=1 [nytimes.com]
Quote: "High-frequency traders often confound other investors by issuing and then canceling orders almost simultaneously. Loopholes in market rules give high-speed investors an early glance at how others are trading. And their computers can essentially bully slower investors into giving up profits -- and then disappear before anyone even knows they were there"
Sure looks like one rule for the HFTs and another for the rest.
If you don't think the HFTs do all that and worse, you can google for evidence yourself.
Re:Not just useless, but actually toxic. (Score:3, Informative)
You can't have this much perfect trading [slashdot.org] without "working how the computerized systems would react to certain trading patterns" for their own gain.
But between this, and other exclusive rights (ie naked short selling etc) to "special" status traders that makes this and other parts of the financial sector a farce.
As for liquidity and spreed. 1 second trades would achieve both just as good as the current system as far as the over all market is concerned. Perhaps not for the 100us traders thou.
126 microseconds what it cant do (Score:3, Informative)
Re:Not just useless, but actually toxic. (Score:3, Informative)
So, it sounds from the article like it had nothing to do with Windows and everything to do with a flimsy system structure.
It may have had nothing to do with MS Windows. But it did have something to do with a flimsy structure that MS helped build, with lots of .Net and C# goodness and integration with MS Ofiice. MS advertised it loud and clear at the time as an example of how MS Windows was chosen over Linux, how MS technology was well worth the small extra costs, and how MS could deliver robustness and speed that Linux couldn't.