Man Group – Low-Latency FX Trading With Aeron Transport and Aeron Archive

In the fast-paced world of foreign exchange (FX) trading, microseconds can mean the difference between profit and loss. At a recent Aeron Community Meetup in London, Oskar Wantola and Tim Raggatt from global active investment management firm Man Group shared their journey of integrating Aeron Transport and Aeron Archive into their low latency FX trading system. Here’s a summary of the key points and insights from their talk.

The Need for Speed in FX Trading

Man Group has a fully automated FX trading system that handles $1.5 trillion FX trades annually. In such a system, latency is critical. Liquidity providers stream FX quotes to market participants, who must respond swiftly to secure the best available quotes before they expire or are taken by others. The fastest participants snatch the best quotes, making low latency an essential component of a successful FX trading system.


← Watch Man Group at the Aeron Community MeetUp

 

Why Aeron?

Before Aeron, Man Group used various messaging solutions but sought an alternative that could deliver speed, reliability, and technical excellence. Aeron stood out for several reasons:

  • Low Latency: Aeron is designed for low latency, which is crucial to be competitive in FX Trading.
  • Reliability: Aeron’s reputation for reliability made it an attractive choice. As an open-source platform, it has been tested and used extensively within the financial industry, which requires robust and fault-tolerant systems.
  • Technical Endorsement: The team at Man Group was influenced by the technical discussions in Martin Thompson’s “Mechanical Sympathy” blog, which delves into the low-level engineering and design patterns that enhance system performance. Aeron incorporates many of these patterns and concepts, which resonated with the team’s desire for a technically sound solution.
  • Performance Consistency: Aeron’s architecture aims to provide consistent performance without long tail latencies. This means that even under high loads, the system is designed to avoid significant spikes in message processing times, which is essential for trading systems.
  • Future-Proofing: The decision to adopt Aeron was also influenced by its potential for future enhancements and integrations. Man Group plans to integrate Aeron with other tools like Artio and ArcticDB (Man Group’s own open-source dataframe database) for diagnostics and analytics, indicating a strategic choice aimed at long-term performance and scalability.

The Aeron Roll Out

When Man Group decided to move away from its legacy messaging tool and started to integrate Aeron, a key technical challenge was navigating the existing infrastructure and shifting the system to a new host. For example, the Linux kernel – which manages the interaction between software and hardware – caused issues with Aeron’s idle strategy holding back immediate performance improvements.

These issues were overcome by creating a virtual environment, simulating the execution system, to test the new software under multiple loads and ease implementation. Parameterising variables such as the number of quotes, their rate of quoting, and idle strategy enabled the tech team to tune the deployment appropriately. The system showed how Aeron could support the low latency messaging needs and helped the development team to productionize the technology.

Performance Gains and Future Plans

Upon moving to a new host with an updated Linux kernel, Man Group observed significant improvements in latency across all percentiles. The successful deployment of Aeron led to its adoption across other trading platforms within the firm, including equities and futures.

Looking ahead, Man Group plans to integrate with:

  • Aeron Archive for real-time message replay and monitoring
  • Artio for real-time diagnostics and analytics.

Learning from a Successful Migration:

  • Open-source messaging systems like Aeron can offer a viable alternative to proprietary solutions for low-latency trading applications.
  • Careful evaluation and simulation are crucial before integrating new technologies into critical systems.
  • A phased migration approach can minimize risks and ensure a smoother transition.

Conclusion

For trading firms looking to stay competitive in the high-stakes world of FX trading, the case study of Man Group’s integration of Aeron offers valuable lessons in the pursuit of speed, reliability, and technological excellence.

 

 

Oskar Wantola, Man Group and Aeron messaging

Oskar Wantola
Head Execution Technology
Man Group

Tim Raggatt, Man Group and Aeron messaging

Tim Raggat
Staff Engineer Execution Technology
Man Group

Man Group & Aeron messaging

Man Group is one of the world’s largest independent active investment management firms, focussed on delivering attractive risk adjusted performance for its clients. Its investment capabilities, across Systematic, Discretionary and Solutions, have combined funds under management of US$ 175.7bn*.

Technology is key to the on-going success of the business. Man Group aims to ensure that they are at the forefront of the technological curve with regards to investment and risk management, trading and operations.

*as at 31 March 2024