The FIX protocol has been around for years – since 1992 in fact – and is pretty much ubiquitous in the world of electronic trading. But it is still difficult to implement for many. IntelligentTradingTechnology.com spoke to Chris Lees, founder of London-based startup FixSpec, to find out what the issues are, and what his company is doing to help.
Q: How did FixSpec get started? What’s its mission?
A: FixSpec is a response to an over-looked but very widespread area of inefficiency in our industry. Venues and brokers devote huge amounts of time, money and effort to building and promoting their trading offerings, but when the time comes for clients to technically connect, the process becomes slow, costly and error-prone.
For clients who develop interfaces themselves, this technical connection is their first impression of the service and it therefore needs to be as smooth and pain-free as possible. Clients connecting through vendors can have a smoother path, but only once the vendor connection is in place; and anyone who has ever asked a vendor to prioritise their interface knows that this can be a costly and slow process, especially for start-ups who find it difficult to justify why they should be prioritised over established connections.
FixSpec’s mission is to provide new tools to help the trading community (clients and vendors) to find, understand and develop trading connections faster and easier.
Q: FIX is an industry standard. So why is FixSpec needed?
A: You frequently hear people talking about “standard FIX”, but in practise this is a myth – nobody speaks “standard FIX” – and that is where FixSpec comes in.
FIX-enabled venues and brokers maintain a “rules of engagement” document that is relevant and specific to their trading service. Sometimes running into hundreds of pages, all of these documents are produced by the same process: (1) select a FIX standard as a baseline, (2) remove the tags, values and messages you don’t support, and (3) add in extra tags, values and (sometimes) messages that you need to correctly drive your functionality.
The flexibility to customise your spec by adding and removing elements is very powerful, but it leaves us with a problem – how to communicate these rules of engagement? For the last decade, the solution has been to put them in a PDF on a website or (more commonly for brokers) email them to clients on request.
At FixSpec, we believe that emailing specification PDFs is an insanely inefficient way of working in the modern world; can you imagine Google launching a new API by emailing a PDF to developers on request? Our vision is to build a global, cross-asset repository of specifications to give developers the access and tools they need to work more efficiently.
Q: Can you quantify how much of an issue this is? How many different variants of FIX are in production today?
A: Since every FIX trading service has a bespoke rules of engagement document, we estimate that there are at least as many variants of FIX as there are FIX-enabled services. When you add market data specifications and client-customised interfaces, this number can easily run into thousands of trading specifications worldwide.
Each document varies in both quality and length; a simple page count of the specifications from the top three European equities venues (LSE, BATS Chi-X and NYSE Euronext) totals almost 400 pages. Since PDF is a format that cannot be easily parsed or compared, imagine being a developer faced with keeping on top of hundreds of pages of dry, technical detail, and never quite knowing whether you even have the latest document version!
It is no wonder that FIX recipients frequently report that they must answer questions or encounter UAT errors which are clearly documented in the spec – the developers aren’t reading the specifications cover-to-cover. And who can blame them?
Q: What does FixSpec actually provide to make it easier to use FIX?
A: The core idea of FixSpec is to ditch PDF documents in favour of online versions, “freeing” the data so we can add some great efficiency tools on top:
– Specifications that are easy-to-navigate, search and link to, and which are always up-to-date
– The ability to decode raw FIX messages (or a whole log file) against a spec to pinpoint incorrect tags or values
– Being able to compare two specs at the push of a button to see a prioritised list of differences (and therefore gauge development effort required)
In November we launched our first online specification with UBS MTF, and we will add more proprietary specifications in the months to come in conjunction with the authors of those specifications.
Replacing PDFs with online equivalents won’t happen overnight, however, so we have also built a search engine which indexes specifications and gives developers a single point to find the latest version of a spec, as well as a way to subscribe to email notifications of changes.
Q: What kind of job function at a market venue or trading firm will use FixSpec.
A: Our tools are primarily designed to assist the developer community in trading firms and vendors, who are working with specifications to write trading interfaces. We aim to help them to develop faster and with fewer errors, and therefore deliver value not only to their firms and clients, but also to the counterparties that they want to connect and trade with.
Q: Do you plan to expand beyond FIX? To FAST, or other lower-latency protocols?
A: Absolutely. Despite having FIX in our name, we aren’t restricting ourselves to one protocol. Watch out for an announcement around ITCH this quarter, and we are looking to add binary and other proprietary protocols later in the year.
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