Redline Runs Risk Checks in Nanoseconds
Traders Magazine Online News, April 18, 2012
Redline Trading Solutions, a provider of high-speed trading products for high-frequency traders, is offering brokers pre-trade risk check software that performs in less than one microsecond.
The new service, dubbed Redline Pre-Trade Risk Solution, performs risk checks in the 400 to 900 nanosecond range, depending on the broker's risk check configuration. Utilizing a web-based interface, the software enables customers to set a wide range of order-level and position-level risk checks that ensure compliance and protection prior to execution, according to Mark Skalabrin, chief executive at Redline.
Brokers must provide risk checking to the buyside orders in accordance with the Securities and Exchange Commission's Market Access Rule 15c3-5.
"The risk checks include the basic fat finger checks, as well as portfolio checks in terms of orders, current positions and prices," Skalabrin said. "The solution checks every order against the current market price of the securities."
He added that the risk checking program includes a live data feed that allows the software to update the portfolio inreal-time -.
The fewer risk parameters set, the faster the check, Skalabrin said. Conversely, the more risk check criteria used the slower the process.
Redline Pre-Trade Risk Solution is now in service with several brokers, including one bulge firm and several and mid-tier brokers. Redline would not disclose names.
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