Alex Malone President and Founder, Helium Systems LLC
Alex Malone President and Founder, Helium Systems LLC

Winning the war against latency

Many describe latency as an unseen enemy that relentlessly nibbles away at profits. Like the cold and flu viruses that wreak havoc in the winter months, we know latency is there and we hope that it doesn’t make us sick.

First Published: e-Forex Magazine 29 / The e-FX Mechanic / October, 2007

Many describe latency as an unseen enemy that relentlessly nibbles away at profits.  Like the cold and flu viruses that wreak havoc in the winter months, we know latency is there and we hope that it doesn’t make us sick.  Latency is defined as the time difference, usually measured in milliseconds, between an action and response or between two related events.  Most IT professionals proactively seek the fastest server hardware, best telecommunications lines, and relocate servers next to the exchanges to try to minimize the effect.  However, they may not know if these changes have a positive effect on profit.    Quantifying the effect of latency is particularly challenging, because it not only depends on the speed of the communication lines, but also on applications and strategies. Some trading firms rely on technology partners to host their black-box solution, with the promise of low latency in the service level agreement (SLA), but no data to back up the...continued

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