HFT at the CME - rigged to those that can pay

i960 said:
This only handles things up to the point of demarcation where they hand it off to the server itself. Then it becomes about who can use the fastest NICs, who can write the fastest software that's residing at the kernel layer or even no kernel at all, just full blown custom hardware.

Are you saying CME is utilizing some kind of complex per-switch QoS to guarantee a level playing field? I seriously doubt that. Sure they might be providing equidistant layer 1, but that's *just* layer 1.
More...
It is my understanding that many years ago NASDAQ imposed a many millisecond delay on connections based upon their proximity to the matching engines (they were located in Connecticut at that time, I think). The closer the end point of a connection was to their matching engines, the higher the delay. They did this to equalize the latency among all their connections (so West coast firms were not at geographical disadvantage compared to East coast firms).

I also understand that the SLA in Aurora limits the length of fiber between any customer cabinet and the CME's equipment to 12 inches. For data traveling at a rate of 10Gb, 12 inches represents about 1.5 nanoseconds.
 
Is there any anecdotal or first-hand accounts of traders having to "chase" the market to get a fill in terms of electronic futures ? In other words, are traders or brokers being front run in electronic futures markets like they were on the stock exchanges ? This is different than spoofing - what I am referring to would be the ability for a third party to know the composition and intent of incoming order flow in advance to the point of taking advantage.

There is no doubt that upper tier automated trading groups are willing to spend large sums for superior ECNs. In that sense, like the rest of capitalism, the golden rule applies.
 
FCXoptions said:
http://www.cmegroup.com/globex/files/CME-Co-Location-Services-Overview.pdf search the word on this page and it will come right up...very first link on google when searching "cme data center cable length". If you ever go to a presentation by them on co-lo, they make it very clear that everything within the building is equal down to the smallest details.
More...
Ok, I am impressed by this.

Chicago = Independent. Fair. Progressive (we need to fix the south side)
NY = Goldman Sach's bitch
 
Last edited:
nitro said:
Ok, I am impressed by this.

Chicago = Independent. Fair. Progressive (we need to fix the south side)
NY = Goldman Sach's bitch
More...


This is funny... You've come along way since your first post on this thread
 
IAS_LLC said:
This is funny... You've come along way since your first post on this thread
More...
Well, I was misinformed on the CME. I don't colocate there but I do at NY4, and I just ASSuMEd that these exchanges were all evil. Equinix in NY caters to the old boys club and doesn't give a shit about anything but the bottom line. Small clients can go fuck themselves. If they could they would charge you to be in the same room with them breathing their air. I would not be surprised if Chicago built out Aurora exactly because they got tired of Equinix.

The CME does appear to want to do right by its clients, all its clients. It is not perfect, but perfect is the enemy of the good. There are things that would further revolutionize the industry, but it is probably going to be a different tech company that takes the next step forward toward truly fair markets that allow true fair access at all levels.
 
Last edited:
Nitro, props to you on being honest and fair with yourself and your perceptions.

One thing that I think the CME has consistently done right is to try NOT screw over the smaller independent traders. Eurex did it, and their declining volume shows it.
 
jjw said:
It is my understanding that many years ago NASDAQ imposed a many millisecond delay on connections based upon their proximity to the matching engines (they were located in Connecticut at that time, I think). The closer the end point of a connection was to their matching engines, the higher the delay. They did this to equalize the latency among all their connections (so West coast firms were not at geographical disadvantage compared to East coast firms).

I also understand that the SLA in Aurora limits the length of fiber between any customer cabinet and the CME's equipment to 12 inches. For data traveling at a rate of 10Gb, 12 inches represents about 1.5 nanoseconds.
More...
Correction for a small typo. The last sentence of my previous response should have been:
I also understand that the SLA in Aurora limits the difference in the length of fiber between any customer cabinet and the CME's equipment to 12 inches. For data traveling at a rate of 10Gb, 12 inches represents about 1.5 nanoseconds​
 
nitro said:
Well, I was misinformed on the CME. I don't colocate there but I do at NY4, and I just ASSuMEd that these exchanges were all evil. Equinix in NY caters to the old boys club and doesn't give a shit about anything but the bottom line. Small clients can go fuck themselves. If they could they would charge you to be in the same room with them breathing their air. I would not be surprised if Chicago built out Aurora exactly because they got tired of Equinix.

The CME does appear to want to do right by its clients, all its clients. It is not perfect, but perfect is the enemy of the good. There are things that would further revolutionize the industry, but it is probably going to be a different tech company that takes the next step forward toward truly fair markets that allow true fair access at all levels.
More...


Gotta echo Bone. Props for allowing your opinions to evolve as you obtain more information.

The reasons you state are exactly why I trade CME markets, and not equities. I don't colocate with CME...but its on my growth plan.
 
You must log in or register to reply here.
Back
Top