High-frequency trading (HFT) has received a lot of attention during the past couple of years, turning into an increasingly important component of financial markets. HFT is all about the speed: the faster your computer algorithms can analyze cambodia telegram data stock exchanges and execute trade orders, the higher is your profit.
In Pursuit of Ultra-Low Latency
So the ‘arms race’ in this area never stops with market players continuously investing in more powerful solutions, able to trade securities, derivatives and other financial instruments in a matter of nanoseconds. Only those HFT firms that keep pace with technological innovations, will be able to secure their competitive advantage in the future.
To reduce the time needed for the market data round-trip, investment banks, hedge funds, and institutional investors spend big sums of money on faster software, networks with lower latency, and computing facilities closer to stock exchanges.
When it comes to hardware acceleration .
T he solution often is to offload compute-intensive portions of trading functions to GPUs, FPGAs, or custom processors. CPUs are still valuable for the implementation of certain tasks, but they are no longer able to maintain the required speed of trade execution.
As you can see there is a number of methods available they put customer experience firstfor scaling hardware computing performance. But those are FPGAs, or field-programmable gate arrays, that started the current technological revolution in the area of high-frequency trading.
FPGA chips have very specific technical characteristics that enable them to execute certain types of trading algorithms up to 1000 times faster than traditional software solutions.
In this article, we will retell you in detail about these characteristics and about the significant benefits that high-frequency traders get from the integration of FPGA hardware into their digital infrastructures.
What is FPGA Technology?
To answer the question “What is FPGA technology”, we need to take a closer look at its components and structure.
Strange as it may sound, FPGA is nothing more mobile list than a chip containing a million of logic blocks repeated throughout the silicon. Think of a microprocessor from your laptop or smartphone that can be programmed to perform zillions of operations in a blink. Each of the logic blocks called lookup tables (LUTs) includes basic logical operations such as Boolean AND, OR, NAND, or XOR.
To form an algorithm LUTs are connected to each other in a specific order by means of configurable switches. Both LUTs and the surrounding interconnect fabric are programmable, providing a flexible system, which can be easily adjusted to implement almost any algorithm.
The first commercially viable FPGA device was invented in 1985 by the co-founders of Xilinx. At that point, the chip’s capacity was relatively small, so it was hard to implement a complete logic in one cell.
Today’s FPGAs have mega-million gate counts that allow them to accommodate very complex and large scale designs. It is not surprising this component is often seen as a hardware analog of a program.
FPGA Ultra-Low Latency Drivers
The programmability and extensive capacity of FPGA chips are certainly very important characteristics. But these are the hardware’s parallel architecture and deterministic nature that make it an ultimate solution for reducing round-trip latencies and thus increasing trade volumes.
Parallel Architecture
FPGA devices do not have a fixed processor architecture, including the operating system overhead and all the interfaces and interrupts typical to CPUs.
