at Financial Technnology Year
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Features in Co-location Services
for Market Making/Proprietary Trading
Physical server installations located in or near exchange data centers to minimize latency for high-frequency and algorithmic trading operations.
We ask vendors to mark their product against our feature list. It is not available for all products and in some cases we have derived data from publicly available sources. The list of features follows. Vendors can add a further 10 key features of their own.
Customization & Scalability
Ability to customize colocation to client needs and to scale with trading requirements, including burst capacity.
- Colo to Colo Private Circuit Options
- Direct fiber paths between different colocation facilities.
- Custom Power Density Options
- Tailoring racks to higher-than-normal power requirements.
- Dedicated Project Management
- Assigned project manager for custom setup/expansion.
- Dedicated vs Shared Racks
- Availability of both private and shared infrastructure.
- Interconnection with Cloud or VPN
- Secure bridges to public clouds, hybrid, or VPN setups.
- Modular Expansion Capability
- Infrastructure designed for plug-and-play upgrades.
- Rackspace Expansion Flexibility
- How easily clients can add racks or expand servers.
- Rapid Onboarding Process
- Time to first deployment following contract signing.
- Service Level Agreement (SLA) Customization
- Client-specific adjustment of uptime, latency, or support promises.
- Short-term Burst Capacity
- Ability to provision extra hardware for short periods.
Financial and Contractual Flexibility
Pricing models, contract terms, and billing options that accommodate the dynamic needs of trading firms.
- Billing Portal Access
- Clients can view and manage billing online.
- Bulk or Volume Discounts
- Pricing reductions for larger deployments.
- Custom Billing Cycles
- Monthly, quarterly, or yearly billing options.
- Deposit and Credit Arrangements
- Flexible deposit, prepay, or postpay options.
- Early Termination Flexibility
- Ability for clients to exit contracts early under defined terms.
- Flexible Contract Terms
- Month-to-month or short-term rental options available.
- Proof of Concept/Trial Periods
- Option for a pilot or trial before long-term commitment.
- Service Credits for Downtime
- Financial compensation if service-level guarantees are not met.
- Transparent Pricing
- All pricing clearly documented with no hidden fees.
- Usage-based Billing
- Pay-for-use billing for power, bandwidth, or servers.
Hardware & Server Provisioning
Details about the physical server offerings, customization options, and performance guarantees for trading workloads.
- Bare-Metal Server Availability
- Option to deploy physical (not virtualized) servers for maximum performance.
- Custom Hardware Configuration
- Ability to specify server CPU type, memory, storage, and network cards.
- Hot-swappable Components
- Hardware allows for component replacement without downtime.
- Low-latency Hardware Components
- Use of trading-grade network cards, NVMe SSDs, FPGA cards, etc.
- Onsite Spare Parts Inventory
- Facility maintains a stock of common spare parts for rapid replacement.
- Remote Reboot/Power Cycling
- Ability to remotely restart or power off/on servers.
- Server Density per Rack
- Number of servers supported per standard rack.
- Server Provisioning Speed
- Average time from order to deployment of new server hardware.
- Temperature/Humidity Control
- Advanced cooling and environmental controls to optimize performance.
- Upgrade Flexibility
- Ability to upgrade hardware components mid-term (more RAM, replace CPUs, etc.).
Integration & API Support
Availability of APIs and integration points for seamless management of co-location infrastructure.
- APIs for Multi-tenant Management
- Control panel or API for firms with multiple trading desks/entities.
- Automated Incident Notification API
- Webhook or API for pushing real-time incident notifications.
- Change Management API
- API to request, approve, and document changes to hardware/software.
- Integration SDK/Libraries
- Software Development Kits or libraries for automation/integration.
- Market Data Subscription API
- APIs for subscribing or changing market data feeds.
- Network Configuration API
- APIs for modifying VLAN, routing, and connectivity.
- Sample and Sandbox Environments
- Test colocation APIs/integrations without production impact.
- Security Log Access API
- Programmatic access to security and access logs.
- Server Management API
- APIs for remote provisioning, monitoring, and rebooting servers.
- Usage and Billing API
- Retrieve resource usage and billing data via API.
Location & Proximity
Features related to the physical and network proximity of the co-location facility to the exchange, which directly affect latency and trading performance.
- Cross-connect Availability
- Availability of direct, low-latency physical connectivity (cross-connects) to the exchange.
- Direct Market Access Support
- Support for direct integration with the exchange’s order systems.
- Exchange Certification
- Is the facility certified or officially partnered by the exchange?
- Exchange Data Center Proximity
- Whether the co-location is within the same data center as the exchange.
- Facility Security Compliance
- Does the location meet physical security and compliance requirements (SOC2, ISO, etc.)?
- Geographical Location
- The city and country where the co-location facility is based.
- Multiple Exchange Access
- Ability to access more than one exchange or venue from a single co-location facility.
- Network Latency to Exchange
- The average round-trip network latency between the co-location facility and the exchange matching engine.
- Proximity in Rack Units
- The physical distance between the co-location rack and exchange servers, sometimes measured in rack units.
- Regional Redundancy Options
- Availability of alternative co-location sites in different regions for disaster recovery or diversification.
Market Data Feed Management
Support/features for managing high-volume, low-latency data streams from exchanges or third parties.
- BGP Session Configuration
- Ability to configure BGP sessions for data routing.
- Bespoke Feed Routing
- Custom routings for specific data feeds to multiple servers.
- Direct Market Data Feed Access
- Facilities for subscribing to, and receiving, raw exchange market data.
- Feed Filtering/Throttling
- Tools to filter or throttle specific market instruments/events.
- Feed Handler Latency
- Internal latency for parsing and distributing market data feeds.
- Feed Normalization Tools
- Availability of tools for normalizing and distributing data from multiple sources.
- Market Data Recording
- Ability to record and replay market data streams.
- Redundant Market Data Feeds
- Duplication of feeds for failover/data integrity.
- Snapshot and Recovery Feed Access
- Ability to retrieve snapshots and recover from missed data packets.
- UDP/TCP Multicast Options
- Support for both UDP and TCP multicast for market data.
Network Performance & Infrastructure
Characteristics of the data/network infrastructure, such as bandwidth, jitter, and redundancy, affecting trading responsiveness.
- DDoS Protection
- Built-in protection against distributed denial-of-service attacks.
- Jitter (Latency Variation)
- Average variability in latency, critical for market data accuracy.
- Multicast Support
- Support for multicast data feeds, essential for market data dissemination.
- Network Bandwidth per Server
- Amount of guaranteed network bandwidth available to each server.
- Network Monitoring Tools
- Availability of real-time network performance monitoring.
- Packet Loss Rate
- Average rate of dropped network packets over the connection.
- Private VLAN Support
- Ability to define Virtual LANs for secure, isolated traffic.
- Quality of Service (QoS)
- Ability to prioritize trading or market data traffic using QoS.
- Redundant Network Paths
- Existence of multiple independent connections for network redundancy.
- Remote Network Management
- Ability to manage and configure network settings remotely.
Power, Cooling, and Reliability
Reliability and high-availability features, including redundant power and cooling, to ensure minimal downtime.
- 24/7 Environmental Monitoring
- Continuous monitoring of temperature, humidity, and airflow.
- Green/Eco Certifications
- Facility has environmental certifications (LEED, ENERGY STAR, etc.).
- Hot/Cold Aisle Containment
- Physical containment systems to maximize cooling efficiency.
- Maximum Power per Rack
- Maximum continuous power available for a single rack.
- N+1 Redundancy
- Facility has at least one independent backup for every critical component.
- Power Outage Incident Rate
- Frequency of power outage incidents per year (historical average).
- Power Usage Effectiveness (PUE)
- Measurement of data center energy efficiency.
- Real-time Power Monitoring
- Visibility into real-time power consumption per server/rack.
- Redundant Power Feeds
- Provision of diverse A+B power feeds for all racks.
- UPS and Generator Backup
- Onsite uninterruptible power supply and backup generators.
Remote Access & Support
Capabilities for remote management, troubleshooting, and support to reduce need for onsite visits.
- Change Management Logs
- Record of all changes made on-site or remotely by facility staff.
- Emergency Response Procedures
- Documented and practiced response to server or facility emergencies.
- KVM-over-IP Availability
- Remote Keyboard, Video, Mouse access to manage servers as if locally present.
- Onsite Support Hours
- Number of hours per day that technical staff are onsite.
- Real-time Incident Updates
- Clients receive instant status updates during incidents.
- Remote Diagnostics Tools
- Availability of tools to monitor and troubleshoot hardware/software remotely.
- Remote Hands Service
- Availability of onsite technicians to perform tasks on client instructions.
- Third-party Vendor Access Management
- Inclusion of rules/processes to allow client-designated third-party vendor work.
- Ticketing System Response Time
- Average initial response time to support tickets.
Reputation & Ecosystem
Qualitative factors that establish the colocation provider’s standing in the trading industry and the available partner ecosystem.
- Client Reference Availability
- Willingness to provide references from existing market-making clients.
- Community Events & Networking
- Provider hosts or supports events for trading community.
- Ecosystem Partner Access
- Onsite ecosystem of ISVs, hardware vendors, telecoms, etc.
- Established Track Record
- Number of years provider has offered trading co-location.
- Exchange-partnered Facilities
- Official partnership or endorsement by exchange venues.
- Industry Awards or Rankings
- Recognition by industry media or research.
- Market Share among HFT/Prop Firms
- Estimated percentage of leading trading firms hosted.
- Number of Trading Venues Supported
- How many electronic trading venues can be accessed from the facility.
- Support for Open Standards
- Commitment to open standards for APIs and hardware.
- Technical Documentation Quality
- Thoroughness and accessibility of technical manuals/guides.
Security & Compliance
Measures to ensure only authorized access, compliance with regulations, and data protection best practices.
- 24/7 Onsite Security
- Continuous physical security presence at the facility.
- Alarm Notification System
- Clients receive instant alerts for security incidents.
- Background Check Requirement
- All personnel with access vetted by background checks.
- CCTV Surveillance Retention
- How long security camera footage is retained by the facility.
- Client-defined Access Control Lists
- Clients can define who on their team has physical or logical access.
- Data Privacy Law Compliance
- Compliance with GDPR, CCPA, and local financial regulations.
- Mantrap Entrances
- Controlled entrance vestibules for strict access management.
- Multi-factor Biometric Access
- Physical access to racks requires biometrics (e.g., retina/fingerprint) and PINs.
- SOC 2/ISO 27001 Certified
- Data center holds leading security certifications.
- Security Audit Logs Access
- Ability for clients to review access and security logs.