We Create Solutions for Fixed Income Electronic Security Trading Firms.
Fixed Income Routing Engine
As competition in the marketplace increases and regulatory reporting times decrease, fixed income trading firms must automate and improve their efficiency or they will be left behind. Traders want to maximize exposure of fixed income offerings and bids across multiple distribution channels while maintaining the ability to execute instantaneously without the risk of overselling inventory. The operations staff wants trades to automatically flow through to the clearing vendor to meet reporting and compliance requirements. And, management wants to see increased trading volume and higher profits.
Responding to these challenges often requires integration and interaction between multiple computer systems – both internal and external to the firm. The solution to this fixed income electronic trading problem is our fixed income routing engine, FIRE.
Primary uses of the FIRE server currently include:
- Quote publication
- Order execution
- Reporting – Trade, Drop-copy, and Regulatory
- Request for quote
- Security master updates
Enterprise System Integration
FIRE uses the Financial Information Exchange (FIX) protocol messaging system to communicate from end to end throughout the system. Other messaging protocols or proprietary data formats that are used by connected systems are translated into or out of the FIX protocol as necessary. This allows the firm’s internal systems and external vendor systems to communicate freely. Connecting another vendor or system to the network merely requires the addition of a gateway module to convert the data flowing from that system into the FIX protocol that is used throughout the network.
- A bid is received from one ATS.
- The FIRE server ensures that an updated offering quote for a reduced quantity is immediately sent to all ATS’s so that the position is not oversold.
- The system either executes the trade or delivers the bid to the trader’s desk for manual confirmation.
A component of the FTLabs FIRE server, referred to as clearing gateway, is used to communicate with the clearing vendor. The clearing gateway converts the trade message to the proprietary communication protocol used by the firm’s clearing provider (for example, Pershing’s UTF format) and route to the clearing firm for processing. Acknowledgements and other alerts messages from the clearing provider are converted back to the FIX protocol and routed back to the trader for storage or processing locally.