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Rob Lane, European Business Manager, Trading Solutions, at Interactive Data

Systematic traders can test the efficacy of new strategies

Interview with Rob Lane – “Our proposition revolves around market data and trading infrastructure. We can supply market data via consolidated or direct feed. How firms actually receive the content depends on the trading infrastructure,” explains Rob Lane (pictured), European Business Manager, Trading Solutions, at Interactive Data.

“We can deliver raw data straight from the exchange, or we can deliver a consolidated data feed. All the information comes down the pipe which is fully integrated to Interactive Data’s 7ticks trading infrastructure; so simply speaking, through this advanced connectivity, a client can pick and chose which content to use and when to use it.”

As the electronic/systematic trading community grows, having access to ultra-low latency market data is vital. Some trading firms will choose to establish a co-location presence next to the source with Interactive Data; others, who may not be high frequency traders, might select Interactive Data’s direct or consolidated feed. Choice and flexibility are critical for Interactive Data to provide, particularly as trading houses constantly change the strategies they use, and their subsequent data requirements.

“Maybe today they are looking at cash equities in Europe, tomorrow it might be Asia. The versatility that we have makes it possible for us to effectively change as and when our clients change their trading strategies,” says Lane. Henk D’Hoore, Head of Product, EMEA adds: “An arbitrage strategy, for example, might look good on paper but you can never be sure until you’ve tested it if it will yield the right results.

“Having a vendor who can provide a multi-asset class consolidated data feed or direct feed makes it possible to pursue different strategies.”

Interactive Data’s consolidated feed provides full-tick level 2 data. It delivers every single tick from the source to the end user or application, ensuring the full integrity of the data is maintained.

“We try to maintain the integrity of the underlying feed as much as possible. If you over-normalise the data you diminish its value. Typically, traders want the underlying integrity of the data because their applications can use it to their own advantage,” says D’Hoore.

Interactive Data supports how clients utilise the data with its 7ticks ultra-low latency trading infrastructure. It offers co-location and proximity hosting services in leading financial centres including (but not limited to) New York, London, Chicago, Frankfurt and Tokyo.

Says Lane: “We can provide raw data from the exchange to complement the consolidated feed but if latency is key, they’ll never go down the consolidated route they’ll always go the direct route via co-location. Firms can utilise this connectivity to support order execution.

“A firm may not be sure if they want to invest in a co-location presence in Singapore, for example. We can support them by a consolidated feed or tick history service to run back-testing. If they’re happy with the strategy, they can then choose to invest in a proximity or co-location, which we can host, manage and support.”

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