Advances in Wireless for Use in High Frequency Trading Could Signal New FinTech Posts
Predictions for 2012 indicate very modest movement in financial services outlays for IT. Nonetheless, the promise of wireless technology and its use in high frequency trading is drawing attention and investment dollars. If the speed of low latency wireless trading holds true, then expect the industry to catch on to the new technology as soon as the takers find it to be reliable. Plus, job opportunities are sure to open up for professionals familiar with IT implementation in a trading setting.
Of course, wireless trading technology has long been promised. So, how far is the technology from real use and, finally, adoption by high frequency traders?
In an interview with eFinancialCareers, Sal Benti, founder and Chairman at NeXXCom Wireless, a full service wireless product and system supplier, admits that those in the banking and investment space are just beginning to adopt wireless tech, but he expects much more traction to come in a short time frame.
He says, “Traders don’t care whether they have fiber or wireless or use both. They just need data integrity and speed.”
Benti also serves as a partner in the consulting firm R Squared Associates, advising on equity and debt financing deals.
Today, communications systems engineers are primarily spearheading and taking pre-existing wireless providers in new directions, expanding their customer base to the HFT community. But engineers don’t necessarily talk trading talk, says Benti.
Expect individuals who’ve worked in a trading division overseeing IT integration to be likely hires to bridge the gap between the wireless industry and the HFT community. It’s also likely that wireless tech providers will poach people in customer-facing roles at other types of finance IT firms to pitch their new wares to the banking and investment space.
The obvious interest in wireless is also driving new business ventures by those from the finance space. Oakland, California-based McKay Brothers is in the midst of building what they call the lowest latency high frequency trading network.
In an interview with Securities Technology Monitor, McKay Brothers’ co-founder Bob Meade said that the firm’s started building a “microwave-based, low-latency wireless network between Chicago and New Jersey, designed for high-performance trading.” The network is set for operation this summer.
Meade served in the derivatives research group at JPMorgan Chase and in quant trading at Robertson Stephens. He also ran a high frequency trading group at Ronin Capital. Principal Jim Considine was previously with JPMorgan Chase, moving from systems roles to equity block trading to co-head of listed and structured equity options trading. He also managed the equity financial products division at Fleet’s Robertson Stephens, working alongside Meade.