To cope with today’s fast-evolving market, exchanges regularly upgrade their technology. Tanzeel Akhtar examines the challenges and opportunities exchanges face when overhauling their systems.
To cope with
today’s fast-evolving market, exchanges regularly
upgrade their technology. Tanzeel Akhtar
examines the challenges and opportunities exchanges
face when overhauling their systems. How good are they at
making these decisions and handling transitions and what could
they do to improve?
Two large technology migrations
are currently under way for futures and options exchanges. The
London Stock Exchange has been migrating parts of its business
onto TMX’s Sola since 2009. At the same time,
Nasdaq OMX is involved in an overhaul of its equity,
derivatives and fixed income trading platforms.
Making such radical changes to an
exchange’s technology without interrupting trading
is a huge challenge – and with new systems costing
large sums, the stakes are high. And what is worse, if the new
technology does not deliver the promised improvements, exchange
members are likely not only to be vocal in their complaints,
but might even shift liquidity to exchanges where systems and
access suits them better.
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