High-performance computing technology can help financial services firms reap huge financial benefits.
Voltaire high-performance switches are helping financial services firms out-trade their competition and reap huge financial benefits.
Voltaire's Grid Director switches are high-bandwidth, low-latency switches based on the InfiniBand standard, and allow the formation of high-performance computing clusters from industry standard hardware. The company also manufactures Fibre Channel and Ethernet switches.
Trading markets were a natural fit for Voltaire, said Patrick Guay, the company's senior vice president of marketing, since they need high-performance switches that can speedily transmit huge volumes of data.
Three or four years ago, Guay said, financial services firms began developing automated trading applications that would take the extraordinarily large volumes of trading data that flowed in, and analyze the data according to many different parameters. The software would then recommend trading decisions based on rules that were unique to each brokerage firm, hedge fund and other trading institutions.
The problem was that in some cases, the software was often processing information faster than the network backbone could transport data.
Using Voltaire Grid Director switches and Ethernet-to-InfiniBand converters, financial firms were able to draw information from traditional network connections and convert that trading data to the InfiniBand standard for processing. This vastly increased the flow of data while simultaneously increasing processing speeds. The result is a huge competitive advantage.
To read more about InfiniBand, click here.
"Financial services firms place a premium on the lowest amount of time it takes to make a trade," said Joe Skorupa, research vice president at Gartner. "If they can trade even ten seconds faster than their competitors the financial opportunity is huge for these firms," he said.
"With this technology, our customers are able to process the transaction much faster than their competitors. In some cases, they can make a trading decision to buy or sell before competitors even know certain instruments are for sale," Guay said.
Guay said that customers are often able to justify the acquisition of high-priced, high-performance hardware like Voltaire's switches because the acquisitions pay for themselves very quickly.
"Our customers tell us that ROI [return on investment] on these systems is less than a week," Guay said.