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Canuck Exchanges Take Solace in Data Distribution

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So Toronto’s TMX Group just let it be known that it’s using Solace Systems’ message routers to distribute its market data. That makes it the second Canadian exchange group to go public with such news, following CNSX Markets, which revealed its planned adoption last September.

Neither exchange group had to travel far to find their new data dissemination technology, Solace being headquartered in Ottawa.

[Musical side note, because I can: The Falcon Lake Incident, by Ottawa’s Jim Bryson, with the Weakerthans, is well worth a listen.]

TMX has apparently been using Solace in production for a while now, distributing data from the Toronto Stock Exchange and the Toronto Venture Exchange. CNSX – probably better known by the Canadian National Stock Exchange and Pure Trading exchanges that it operates – should be rolling out next month, after the usual “integration issues” put go live back from before the holiday season, says CNSX VP of corporate development, Richard Carleton.

There’s not a lot of detail in the TMX press release, but the motivation for going with Solace is likely to be similar to the reason why CNSX has adopted the technology. It’s about being able to distribute lots of data, using standard protocols, to many recipients, at low latency.

While CNSX uses TCP/IP data streams (and so Solace certainly will help a lot with scaleout), TMX’s data services use multicast for outbound, and TCP/UDP for retransmission (so the scaleout benefit is really on the retransmission side).

With an increasing number of trading firms looking to take direct feeds for high frequency and algo trading, Solace’s messaging appliances represent a pretty straightforward route that market centres can take to boost performance, essentially by offloading the communications handling from a central matching system.

Architecture wise, separating out the matching and data dissemination processes is pretty simple. Which is good news for TMX (and Solace’s tenure there), where the central system may well change in the future, should the planned merger with the London Stock Exchange go ahead.

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