Market Structure- A post about the way we are connected to the markets

M

marketwalker

Hello everybody.

I've been day-trading for one year. Lastly I've been checking some of the websites from of the markets and ecns, and I have no clear idea about how the market interconnection is built ( the way the markets and the people are connected).
Here are some questions I would like to ask:

-Do the markets have a centralized or decentralized structure? I mean are all the markets connected to a network called STFI, the basic one that everybody is connected to?
-If the previous questions is correct. I'm using Sterling software. In some of the websites I read that Sterling gets acces to the markets by a big routing system called FIX, is it true?
-If anybody knows any website explaining these type of issues please tell me. I'm starting to learn trading from the very basics.

Thank you very much.
 
markets are decentralized...

Nasdaq, NYSE, Arca, BATS, EDGX and all others have there matching engines housed at different locations and are independent from one another. However almost all of them are interconnected to each other...

FIX is not a routing system but rather a protocol for communicating.

http://www.fixprotocol.org/what-is-fix.shtml

So Sterling takes your orders, translates them from their proprietary format into FIX and then sends them to the appropiate destination...

make sense?

- mnx



Quote from marketwalker:

Hello everybody.

I've been day-trading for one year. Lastly I've been checking some of the websites from of the markets and ecns, and I have no clear idea about how the market interconnection is built ( the way the markets and the people are connected).
Here are some questions I would like to ask:

-Do the markets have a centralized or decentralized structure? I mean are all the markets connected to a network called STFI, the basic one that everybody is connected to?
-If the previous questions is correct. I'm using Sterling software. In some of the websites I read that Sterling gets acces to the markets by a big routing system called FIX, is it true?
-If anybody knows any website explaining these type of issues please tell me. I'm starting to learn trading from the very basics.

Thank you very much.
More...
 
Thanks man to reply,

Just two things:

You said to me "almost all of them (the markets) are interconnected to each other...". I think that absolutly all of them must be interconnected, Cause they gotta protect the NBBO, isn't?

And another. According what you said, the only centralized network is the one betwen the users and the software (Sterling)?

Thank you very much mnx

Good trading
 
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