November 1, 2013

Got Algos? Torture Test Them

By

John D'Antona Jr.

Car manufacturers get their own test track, so why not traders? Nasdaq and technology vendor Thesys Technologies are offering algorithmic traders a testing facility to put equity algorithms through their paces.

Both buyside and sellside traders can now test their algorithms and simulate trading on all major equities exchanges at this facility, dubbed "Algo Test Facility," before taking them live.

The Algo Test Facility will allow market participants to simulate their automated trading strategies against real-world scenarios, transactions and competitors to manage their risk exposure and capital expenditure. The facility is designed to allow traders to test all aspects of their strategy, from the quality of their quote processing all the way down to order handling and the interaction of the trading algorithm with the market microstructure.

The Algo Test Facility is expected to launch in the first quarter of 2014 at Nasdaq's Carteret, N.J. co-location facility.

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