What’s an RTD without an RFC?

Low latency networks are critical to the electronic trading community… How do you ensure you’re getting what you’ve been promised before it’s too late? The Answer…ask for an RFC report that will back up the RTD claims.

Providers are continually competing to offer the lowest latency routes, firing out numbers left, right, and centre. Sometimes it feels like you’re caught in the middle of a bidding war at an auction. But how can you trust the integrity of these numbers?

After all, you wouldn’t buy a house without fully surveying the entire building down to the last detail – why should buying connectivity be any different?

Proving latencies is simpler now than ever before. RFC-2544 testing is the industry-standard service activation test (SAT) used to measure not only real-time latencies but also overall network performance. A standard RFC-2544 test will tell you:

  • Throughput
  • Frame loss rate
  • Burst tolerance
  • Packet Jitter
  • Latency
  • Reset recovery

All providers are required to provide an RFC test post-sale but very few are willing or able to provide one pre-sale. Surprisingly, fewer than 20% of telco companies are able to provide an RFC test as standard upon delivery. Only a select few elite connectivity providers can offer performance testing pre-sale upon request. Marketlinx can help you identify the which ones…

What is there to hide?

One of the primary reasons for not providing RFC tests on-demand is a lack of required equipment and/or resource. Carrying out an RFC test either requires engineers to be on location at both ends of the network or for sophisticated equipment to be in place at either end of each cable system to carry out the tests remotely.

Carriers leverage the latest equipment to perform testing via Ethernet to confirm that the circuitry provided is performing at the expected speed with no packet loss, its latency is within the outlined parameters, and there are acceptable or limited amounts of jitter across the whole network.

If customer experience is important, the ability to be able to prove the quality and performance of the network should be considered an essential part of the sales process. After all, without proof in the numbers, what is there to sell?

The value of integrity

Some providers are providing more and more network test results to clients prior to on-boarding and, for existing clients, at the start of a new project.

When you are delivering premium high capacity networks, there is a need to demonstrate that it’s fit for purpose at the outset and that you have an assurance model that can support that service through its lifecycle.

The next time you hear an RTD which sounds too good to be true, remember, an RTD without an RFC really is just a number.

FX Traders: Stop the Slippage or Risk Slipping Up

This article was originally written by Gareth Richardson for Custom Connect.

For FX traders, overcoming slippage is one of the biggest challenges for maintaining potential profitability. Thankfully there is a two-step weapon for combating slippage, a tactic and technology choice that those leading the market have already discovered and implemented.

Without affinity to any provider, we can share the secret that will help control the effects of slippage. The strategy is simple – it is knowledge. The technology is even simpler – ultra-low latency connectivity between trading hubs and local economies.

Once you understand the implications of slippage and possess the necessary market knowledge, you can begin to minimise your loss potential. Trade transaction costs occur due to a gap in time, which if amplified can result in critical losses. This is a particular concern if conducting a substantial amount of trades in a day – a strategy that applies to High Frequency Trading (HFT) and Algorithmic Trading companies.

Thankfully you can reduce this gap, both with high performance global connectivity and a local trading presence.

Making the World Faster and Smaller

Connecting key FX liquidity sites spread across the world in an optimised manner is often easier said than done. Geographical dispersion naturally has an effect on network latency – the speed that data, and thus potential money / profit, is being transferred at.

The more trading locations, data centres, and local access partners you have, the more ‘ears’ you have on the ground. However, the larger the arsenal, the better the network has to be to ensure your trading presence can deliver its maximum return on investment (ROI). There is also the need for an increasing amount of local knowledge from a range of perspectives when you scale across the world – carrier choice, technology and functionality, cost effectiveness and general integration concerns.

If you have a sluggish network – infrastructure with latency in the milliseconds or even slower, full seconds – you will not be able to keep up with the competition, nor keep on top of the vast number of instant trades closing.

Conversely, if you do implement an intelligent network on the ground in emerging FX hubs (Seoul, Moscow and Sao Paulo being current favourites) you should find yourself with a huge advantage over competitors that have overlooked the importance of this local presence.

Furthermore, with the right co-location facilities, (data centres have become the eavesdropping tool of the 21st Century, i.e. having data centre connectivity so close to a local exchange is the equivalent to having a team of specialists in the region), you can receive critical information about trades ahead of everyone else.

Put simply, the knowledge you need to reduce slippage is unlocked through ultra-low latency networking.

Data Transactions Unleashed

Sadly, navigating the marketplace to implement the above connectivity can be troublesome, confusing, expensive (if mistakes are made) and time consuming. The best approach to eradicating potential issues and ensuring you receive the right solution is to illicit the help of a sector specialist that does not favour any carrier, partner, solution provider or its own sales.

Searching out a vendor agnostic, carrier neutral specialist will not only deliver the more suitable network for your objectives, but it will also allow you to consolidate existing solutions, legacy equipment and customer service contracts into a single cost effective hub matching your specific aims, and therefore allow you to focus on your trading strategy, not your IT.

Whatever the connectivity at the heart of your trades – dark fibre, intelligent IP networks, Ethernet or if you desire the very best low-latency option on the market, microwave technology (a highly customisable option that delivers latency ~40% lower than other means) – you can be sure that with a trading telecommunications specialist steering your IT, you will surpass the competition, and most importantly, stay ahead to lead the race.

So, stop risking your profitability, eliminate the belief that slippage is an acceptable cost of international trading and take your company’s destiny into its own hands. After all, as they say knowledge is power. Nowhere is this truer than in the trading community. The only step remaining is making the decision to begin.