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Chicago - where the Big Data grows

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Watching how data volumes coming out of the Chicago derivatives markets have been growing is what you do when you have to build IT infrastructure to support a modern bank or broker anywhere in the world.  Moore’s Law, where processors double in power every 18 months, becomes a practical bottleneck, because the world isn’t governed by Moore’s Law of processor power – it’s governed by Butters’ Law for networks where network capacity doubles every 9 months.  That means that you’ve got an exponentially-increasing difference between the volume of incoming data that you have to process and your firm’s capability to process that data.

Looking at recent statistics from the FIF Financial Information Forum (www.fif.com) we’re seeing the volume of data coming out of securities-type trading platforms hit the 100,000 messages per second level per trading platform.  But this is small compared to what’s coming out of Chicago, and you need to keep an eye on the data traffic forecast from OPRA (Options Price Reporting Authority) to see what that impact already is and is expected to be.

A dealing room today that wants to follow all of the Chicago derivatives markets in real-time needs to be capable of handling over 6 million messages per second.  And that’s happening already – and the volumes are continuing to increase significantly, just as they have done for the last 20+ years.

10 years ago, derivatives exchanges in Europe were balking at telling their members that they should plan to increase their network capacity from 4 Mbps to 10 Mbps.  Today a single firm needs over 1 Gbps just to receive all of the market data from Chicago without its network being a throttle that slows down its receipt of that data.

And as well all know, in financial markets today, microseconds mean money.

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