Redline Leverages Lenovo to Deliver Ultra-Low Latency for Financial Markets

CASE STUDY

OverviewWith a huge amount of money at stake, financial markets firms are in a constant arms race to minimizeend-to-end latency and seize fleeting market opportunities ahead of the competition. With Redline solutions on 32-core compact System x3750 M4 servers, based on the Intel® Xeon®

processor E5 family of processors, firms can reliably achieve ultra-low latency and predictable performance. Extreme low latency and deterministic performance enable firms to spot and act on profitable trading opportunities faster than competitors; expertlypre-integrated hardware minimizes tuning effort.Redline Trading Solutions (Redline) creates ultra-low latency market data and order execution systems that

enable firms to excel in today’s equities, options, futures and FX markets. Redline helps firms achieve faster, more deterministic trading performance while lowering development and operational costs.

For firms that rely on high-frequency trading, smart order routing and algorithmic trading, time-to-market drives profitable trading. Profitability can come down to a matter of microseconds (μs), so market players are in a constant arms race to cut end-to-end latency and seize fleeting opportunities ahead of competitors. This means cutting the time to receive market data, process it, determine trades, perform risk checks and submit orders.

Lee Fisher, VP, Technical Marketing at Redline, comments: “We optimize our code for multi-core Intel® Xeon®

processors to achieve ultra-low latency. As the number of cores per socket grows, we can execute more market data feeds and application threads in a single server, eliminating box-to-box hops that add latency. Using higher core-counts to reduce the number of servers also cuts capital costs, operational costs, and hosting fees at co-location sites.”

“Lenovo has enormous expertise in tuning systems for low latency, and offers support in financial centers worldwide.”

—Lee Fisher,VP, Technical Marketing, Redline Trading

Solutions

Redline delivers reliable ultra-low latency for financial markets firms with powerful and efficient System x servers

COMPUTER SERVICES

CASE STUDYCOMPUTER SERVICES

Extreme performance, industry-standard hardwareRather than requiring specialty FPGA hardware to achieve low latency, Redline’s software architecture is optimized for industry-standard multi-core processors to deliver extreme throughput and low latency. With platforms based on the Intel® Xeon® processor E5 family of processors, clients can deploy their entire trading system on 32 cores in a single 2U System x3750 M4 server.

“Intel’s rapid progression in core-count per socket is great news for firms who seek ultra-low latency in the smallest possible physical package,” says Fisher. “With servers like the x3750 M4, they can pack more processing into rented co-located rackspace, reducing costs and latency.”

Redline tailors its software to selected high-performance network adapters, enabling it to pull market messages at high speed from the wire directly into memory;System x offers these supported adapters as pre-integrated options within the System x3750 M4. Depending on the balance between the number of market data feeds subscribed to, the number of network adapters to insert and the number of cores required to run the trading application, Redline clients may also deploy on smaller two-socket (16-core), 1U servers such as the System x3550 M4 or the2U System x3650 M4.

Maintaining predictable low latencyRedline is a market leader in cutting latency to the lowest achievable levels. Its InRush 3 Accelerated Ticker Plant product, which connects data feeds from exchanges to client trading applications, offers average latency below 1.2 μs. The Redline Execution Gateway forms and tracks orders, with an average latency as low as 3.0 μs, and its Pre-Trade Risk Engine enables firms to handle SEC Rule 15c3-5- compliant pre-trade risk checks with average latency of less than 1.0 μs.

These latency figures translate into first-mover advantage: firms can process market information, determine trades and execute their orders ahead of their competitors. As firms look to trim every possible microsecond out of their end-to-end cycles, stretching the window of opportunity for profitable trading, even minor variances in server configuration and tuning can have a negative impact.

Fisher adds, “We test our software extensively on System x. In our experience, System x servers deliver predictable high throughput and low latency based on their high-performance design, build-quality, and integrated network adapters.”

Scaling performance with more coresAs Intel continues to increase the number of cores per socket, Redline can further reduce latency for its clients thanks to the scalable architecture.

“We believe our multi-core design delivers better real-world, end-to-end, tick-to- trade performance than specialty FPGA hardware,” says Fisher. “With each new processor generation, we can handle higher volumes in a single server footprint,

Solution componentsHardwareSystem x3750 M4 with Intel® Xeon® E5 family of

processors

CASE STUDYCOMPUTER SERVICES

eliminating the latency of server-to-server hops. This also potentially removes the need for complex and costly high-speed server-to-server interconnects and esoteric coding.”

Market data rates continue to increase as exchanges make throughput and networking improvements, resulting in an order of magnitude increase in quote burst rates. While traditional IT provisioning may look askance at idle cores on servers, the standby capacity provided by a 32-core system can ensure that Redline’s mission-critical trading system doesn’t fall behind when rates spike.

“The System x3750 M4 continues to be one of the servers we recommend to clients, based on the strength of its performance and also its reliability, compactness, efficiency and build-quality,” concludes Fisher. “These qualities mean that our clients can be confident of getting the expected performance out of their mission-critical trading systems at all times.”

For more informationTo learn more about Lenovo Data Center Systems solutions, contact your Lenovo Sales Representative or Lenovo Business Partner, or visit: lenovo.com/systemsFor more information about Redline, visit: www.redlinetrading.com

“The System x3750 M4 continues to be one of the servers we recommend to clients, based on the strength of its performance and also its reliability, compactness, efficiency and

build-quality.”—Lee Fisher,VP, Technical Marketing, Redline Trading

Solutions

© 2016 Lenovo. All rights reserved.

Availability: Offers, prices, specifications and availability may change without notice. Lenovo is not responsible for photographic or typographic errors. Warranty: For a copy of applicable warranties, write to: Lenovo Warranty Information, 1009 Think Place, Morrisville, NC, 27560. Lenovo makes no representation or warranty regarding third-party products or services. Trademarks: Lenovo, the Lenovo logo, and System x are trademarks or registered trademarks of Lenovo. Microsoft and Windows are registered trademarks of Microsoft Corporation. Intel, the Intel logo, Xeon and Xeon Inside are registered trademarks of Intel Corporation in the U.S. and other countries. Other company, product, and service names may be trademarks or service names may be trademarks or service marks of others.

LYC03154-USEN-02