The recent exchange outages are an inevitable consequence of keeping up with today's markets, writes Galen Stops
The automated trading environment, and the technology that
underpins it, is coming under serious scrutiny, and with good
First of all and algo ran amok, almost bankrupting Knight
Capital, and then last week the Tokyo Stock Exchange (TSE) and
Bolsas y Mercados Espanoles (BME) both suffered technical
glitches that halted trading on them.
The TSE said that a problem with the router in its Tdex+
derivatives trading system was the cause of the 93 minute
outage on its derivatives platform.
For the Japanese exchange this is becoming an alarmingly
regular problem. In February 2012 a breakdown in its data
distribution system halted trading on 241 securities and in
December 2011 it suffered a blockage in network cables that
slowed down execution.
At the BME it is still less clear what the problem was,
although recently the bourse has been implementing new
technology infrastructure that has made its trading system ten
times faster and plans to introduce collocation facilities.
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