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Networking Solutions

Low Latency and High Performance for Financial Applications

Industry Solutions

Smarter Networking for Financial Services
In financial markets, market data applications must deliver information at ever-increasing rates and with minimal latency. Market data arriving even a few microseconds late can have huge negative impact on a financial trading firm. Currently, Gigabit Ethernet networks are reaching their limits in bandwidth, maintainability and latency. Multi-core processors, virtualization and converged storage and data networks require an efficient solution for adding bandwidth. Scaling to 10 Gigabit Ethernet is a natural evolution for Gigabit Ethernet networks, and doesn’t require expertise in deploying and maintaining separate network fabrics.

In addition, traditional three-tier data center architectures consisting of server access switches, distribution switches and large core routers take up a lot of space. And they can require data to travel many hops just to communicate with other servers in the same rack or row. Using denser racks and top of rack switches can shrink data center footprint, enable faster communication across fewer hops and minimize overall application latency.

Ultra low latency switching inside a collocated network gives program traders a competitive advantage. In the fast-paced world of High Frequency Trading (HFT), lucrative opportunities such as liquidity imbalances and short-term pricing inefficiencies might exist for only a few microseconds. Success depends on identifying and acting on those opportunities faster than competitors. That responsibility rests on the trading network. Ever since high-performance trading applications were introduced into traditional trading venues, the quest to increase speed has focused on different parts of the network. Today, the speed quest for high frequency trading networks has narrowed into a laser-like focus on latency. Latency measurements that were unachievable just a short time ago are now common. Organizations wishing to take the next step in reducing latency need look no further than their own collocated equipment. There, replacing a traditional router with an ultra-low latency switch can provide a next-generation competitive edge.

With high performance, low latency, low power and low cost top of rack switches from IBM System Networking, clients can build flatter and faster networks for demanding financial services workloads.

IBM RackSwitch Advantages
The IBM RackSwitch line of Ethernet top of rack switches offer low latency along with features ideal for dense data center deployments and managed or unmanaged collocation facilities:

  • Independently verified for 100% interoperability, line-rate performance and extremely low latency.
  • IBM RackSwitch G8000 1/10Gb Ethernet aggregation switch shaves nanoseconds of latency at Gigabit Ethernet rates while saving 50% in cost per Gbps.
  • Support for Layer 3 protocols enables faster communication with various market centers than traditional routers. Support for IP Protocol Independent Multicast (PIM) Sparse Mode and Dense Mode enables direct low latency connections to multicast Market Data distribution networks.
  • Data center optimized airflow: All RackSwitch models support either Front-to-Rear or Rear-to-Front cooling, letting clients choose the switch that has the same airflow as their server and storage devices. Directional airflow reduces the need for extra cooling devices, reduces costs, and improves MTBF—all ideal for placement in collocation facilities. As a result you spend less money cooling your data center compared to switches that cool from side to side or side to rear.
  • Low power consumption: an average of nearly $200 savings per year per 10 Gigabit Ethernet switch quickly adds up when your data center scales to hundreds of servers and switches.
  • Shorter switch depth (15 inches): allows more room for cables, and makes RackSwitch easy to fit into dense, energy efficient and low cost rack-based solutions such as IBM’s iDataPlex.
  • Simple redundancy: Uplink Failure Detection provides sub-second failover and a loop-free topology without the complexity and slow convergence time of Spanning Tree protocol.

Networking Devices:

*Source: The Tolly Group Report - IBM RackSwitch G8100 & G8124 (PDF, 470KB); The Tolly Group Report - IBM RackSwitch G8264 Resources (PDF, 434KB)