How FIX protocol can boost the efficiency in your Trading?
Decades ago, there was a period where the Internet hadn’t existed. Those were the times in which the bidder and the seller met and negotiated the bidding in a physical location (probably a stock exchange). Something similar to the Pit Trading scene in the movie ‘Wolf of a Wall Street’. This pit trading procedure was exhausting and created a lot of chaos.
During the late 19th century, the trading firms realized the need for machine-readable message protocol, so that a trade wouldn’t be dropped or cannot be made complex. Once the world realized the need for the standard electronic communication protocol, FIX Trading Protocol was established and a community called ‘Fix Trading Community’ was formed.
Many trading firms are adapting technology & innovation, to increase the competitiveness of bidding an investment. Also, the technology is initiating the transaction with minimal human interference and sometimes without even the assistance.
What is Fix Trading Protocol?
FIX Protocol is a series of messaging specification to streamline electronic communications in the financial securities industry. It implements the automated trading of multi-assets, including securities, derivative, and other financial instruments.
This protocol is an industry-driven standard, extensively used by buy & sell-side firms, trading platforms, and even regulators to communicate the trade information. This open source platform is frequently being developed to support evolving trading and regulatory needs and is being relied on by many firms to complete millions of transactions every day.
The participants would be
Increased Connectivity: Reduced cost and the complexity of a connection allows brokers, investment management firms and trading platforms to achieve a more optimal level of domestic and global connectivity.
Adapting to Market Dynamicity: FIX provides a platform on which competition and innovation in trade and post-trade activities can thrive, affecting interaction among various market participants and making markets more dynamic.
Operational Efficiency: Minimizing the number of redundant, unnecessary messages and enhancing the efficiency of the communication protocol of the client base. The time spent in voice-based telephone conversations can be minimally reduced, and the need for paper-based messages, transaction, and documentation are down to zero.
Low Latency: The connections can be low latency connections with reduced cost and complexity. The transactions can attain high speed and transparency with secured connections in multiple connectivities.
Sensiple’s Solution to address the challenges in FIX Protocol:
Sensiple launched PhiFIX, a suite of Multi-protocol (FIX, EMAPI, FAST, ITCH & OUCH) based messaging infrastructure to address the above said challenges in Capital Market Industry. The differentiator of PhiFIX is, it is a comprehensive, robust, scalable FIX Connectivity solution, which supports Multiple Asset Classes, FIX Message Formats and various order routing systems.