Speed is recognised as the key differentiator in today’s trading environment. The adoption of new algorithmic trading systems where computer-programmed algorithms react automatically to fluctuations in the market means low latency is even more critical. A delay in the network of just one millisecond will significantly influence the margins that financial institutions are trading at and the profit they are making from their trades.
Increased competitive advantage
“COLT recognises that network latency and very close proximity of trading infrastructure is at the heart of critical activities such as trading, order management, transaction processing and liquidity management,” said Detlef Spang, Managing Director for the Major Enterprise Division of COLT. “The closer we can get our customers to the venues they are trading on, the more they will increase their competitive advantage.
“Through this partnership, COLT and KVH are able to cover key financial markets in Europe, the US, Japan and other Asia-Pacific regions, where major exchanges are located. Going forward, together with KVH, we will support European and US institutional investors as they enter the Asian market, offering them low latency and proximity services with full end-to-end service management,” he added.
“Despite the global financial crisis continuing, the need for high speed electronic trading continues to increase. Low latency networking has therefore become an extremely important competitive parameter in the global financial industry. In partnership with COLT, KVH expects to accelerate the low latency trading and help increase liquidity in the market,” said Ms. Miyuki Suzuki, President and CEO of KVH.
A survey carried out by COLT earlier this year among leading investment banks showed that reduction of delay in the networks was considered critical for the electronic trading.
COLT is a leading European provider of business communications. COLT specialises in providing data, voice and managed services to major businesses, SMEs and wholesale customers. COLT operates a 13-country, 25,000km network that includes metropolitan area networks in 34 major European cities with direct fibre connections into 16,000 buildings and 18 COLT data centres.
COLT Telecom Group S.A. is listed on the London Stock Exchange (COLT). Information about COLT and its services can be found at www.colt.net.
COLT low latency and proximity hosting
COLT has been offering low latency proximity services in Europe since 2007. COLT is presently connected to over 25 major exchanges and Multi-lateral Trading Facilities (MTFs), including the main exchanges. Examples which can be mentioned publicly include Deutsche Börse, SIX (formerly SWX), Chi-X, Turquoise, and BATs. COLT hosts seven such exchange systems in its own data centres. Earlier this year COLT also extended its low latency Ethernet network coverage to the United States.
KVH was established in Tokyo in 1999 as an Asia-Pacific IT/communications service provider. Through its facility-based optical fibre networks and data centres, KVH offers integrated communications and IT management solutions that include managed services, data networking, internet access, and voice services to business customers.
KVH has a presence in Tokyo, Yokohama, and Osaka (and in Shanghai through its affiliate), and serves over 1,700 corporate customers in broad industry segments including financial services, manufacturing, pharmaceutical, media, and e-commerce. More information on KVH can be found at www.kvh.co.jp.
KVH low latency and proximity hosting
KVH launched its proximity service in 2008 using its Tokyo Data Center as a hub based on experience in network connections with Tokyo Stock Exchange and Osaka Securities Exchange. Moreover, KVH Tokyo Data Center has been endorsed by Tokyo Commodity Exchange (TOCOM) and Tokyo Financial Exchange (TFX) as their access points and proximity hosting provider as of last year. KVH proximity hosting services also started for TOCOM in May and will be available for TFX as well within the year.