WTF: Nanosecond profit: US high-frequency trading relies on hollow fiber optic cables

Source: Heise.de added 15th Dec 2020

  • wtf:-nanosecond-profit:-us-high-frequency-trading-relies-on-hollow-fiber-optic-cables

Not all glass fibers are created equal. Companies like OFS Optics, headed by the Japanese parent company Furukawa, are further developing such cables in order to increase the transmission rate and reduce the latency. Last year, this resulted in a new generation of hollow fiber optic cables that are already being used in US high-frequency trading. Programmed bots take over the trading of stocks at high speed.

The Wall Street Journal reports on the use of hollow fiber optic cables in the USA. They are used between the exchange’s data centers and communication towers, which forward the data by microwave or laser. Hollow fiber optic cables should be able to transmit several hundred meters before the signal becomes too weak. The basic idea comes from the 90 years, but has not been used more widely due to the small range.

30 percent latency reduction OFS Optics writes about its own hollow fiber, called “AccuCore hollow-core fiber”, that the latency per kilometer compared to conventional fiber optic cables 30 Percent or 1, 54 milliseconds decreases. This corresponds to 0, 00154 seconds. Calculated over several hundred meters, that’s a few hundred nanoseconds.

According to the Wall Street Journal this is on the US stock exchange Apparently a big thing, because this way bots are fed with data faster and the automated buy or sell signals arrive faster.

Hollow fiber optic cables take advantage of the fact that light spreads faster in the air than in glass – OFS Optics specifically speaks of 50 percent. The decreasing signal quality above air does not yet play a role in the targeted distances.

(mma)

Read the full article at Heise.de

brands: Basic  Glass  MMA  New  Street  Trading  
media: Heise.de  

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