The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight White Papers

Cinnober: Lowering Door-to-Door Latency to 25 Microseconds within 18 months

This white paper was written by Cinnober.

Today speed is crucial to any trading venue that wants to stay competitive. At the same time, with high-frequency trading gaining an increasing share of overall volumes, the ability to manage rising transaction volumes is also a necessity.

In 2007, Cinnober published a white paper which established some best practices for measuring latency in financial markets, and publishing the results in a clear and understandable fashion. Cinnober also disclosed benchmark figures of its own trading platform with a level of transparency seen neither before nor since, showing that the context of the testing environment is of the utmost importance. Since that paper was published, latency has become a widely-used metric.

In this new white paper, Cinnober continues to explore the measurement of latency and, more importantly, what can be done to minimize it. The paper details the configurations used in recent benchmark tests on a full-blown Cinnober TRADExpress Trading System, showing how these affect the trade-off between latency and throughput. In these tests, the door-to-door latency achieved was 286 microseconds with a business logic latency of 138 microseconds. Cinnober also publishes its roadmap to further reduce latency, the goal of which is to go below 80 microseconds door-to-door within a year and 25 microseconds within 18 months.