Merrill Lynch Intros Under-10 Microsecond Trading Platform
July 20, 2011
Bank of America Merrill Lynch said it introduced a trading platform that executes orders wire-to-wire in fewer than 10 millionths of a second.
The system, called BofAML Express, delivers sub-10-microsecond speed, while working through an embedded series of risk controls, as required by the Securities and Exchange Commission.
Last week, the SEC’s ban on unfiltered or “naked” access to markets, electronically, took effect. That means that Merrill Lynch must enforce the use of risk controls on any trades that go directly from its trading platform to trading venues, that are launched by its customers.
Under the rules, brokers can still sponsor direct access to markets, by their customers, if they provide them their market participation identification.
Direct access is used by high-speed traders, to speed up the delivery of their orders.
“In this highly competitive environment, having the premiere trading platform is imperative as the market adapts to new regulation,” said Michael Lynch, head of Americas execution services. “While we’ve deployed pre-trade risk checks for some time now, BofAML Express gives our clients an edge by compressing latency to levels unimaginable just a short time ago without compromising any controls. “
The platform was initially developed by Thesys Technologies, a New York firm that is an offshoot of Tradeworx, a high-frequency trading and hedge fund firm based in Red Bank, N.J.
Bank of America Merrill Lynch and Thesys also struck a “strategic agreement” to leverage the technology in Europe and Asia and to spread it across trading in more asset classes, besides stocks.
Bank of America Merrill Lynch is a global provider of equity, options and futures trading, sales and research services to mutual funds, hedge funds, broker-dealers, pensions, endowments and other institutions.
