Allston Trading, a high frequency market maker in over 30 financial exchanges worldwide, has installed a Tervela hardware accelerated messaging platform to support application development and monitor application performance, network health and latency in real time.
The Chicago-based market maker excluded software messaging options from suppliers such as 29West and IBM at the start of its IT development project, concentrating instead on hardware-based solutions. It by-passed Solace Systems on the basis that the solution, while hardware-based, still has significant software content, and selected Tervela in April 2010.
Peter Nabicht, chief technology officer at Allston, explains: “Software messaging solutions require a system wide forklift and an error can effect the whole system. If there is an error in a hardware component, you can just turn it off and work out what went wrong without taking everything down.”
Allston will use the Tervela messaging platform as a middle office technology layer that will monitor information and provide a reliable messaging service. The platform is up and running and Allston is pumping data through it successfully, but it is not yet live as other elements of the firm’s development programme, principally software and applications that will sit on top of the messaging platform, are not yet finished.
“Tervela was the obvious choice for Allston,” says Nabicht. “Its messaging architecture is a real differentiator that offers flexibility and openness that doesn’t exist in other alternatives. The Tervela platform delivers the scale, performance and reliability that our business demands.”
Among the technology challenges faced by Nabicht and his team were large and spiky flows of data caused by the company’s broad range of trading strategies and a complex mix of traded instruments including stocks, bonds, futures and options. Such flows can overwhelm traditional messaging systems, but Nabicht has found the Tervela platform works well in the middle office, tempering spikes to ensure the continuity of data monitoring.
Previously a user of multicast messaging, Nabicht says Allston has gained vast improvements from its installation of Tervela technology. “We don’t have to worry about drops and when we listen to the monitoring of all the messages that are sent we hear the right things,” he says. “Essentially, Tervela has given us the ability to quickly deploy a very robust, low latency messaging platform that traditionally our developers would need to build from scratch. Now they can spend their time adding value to our core infrastructure rather than building it. Tervela gives us a new foundation for the next phase of the company’s growth.”
Tervela is Allston’s largest element of vendor hardware, with the company, an acknowledged technology leader, writing its own trading software. As chief executive officer of Tervela Eric Schnadig puts it: “Allston Trading is one of the most technologically advanced proprietary trading companies in the world and its vision for how trading strategies need to evolve is a beacon for those firms struggling to address the performance challenges of today’s market environment.”