As a final example, we look at distributed systems support financial trading markets. The financial industry has long been at the cutting edge of distributed systems technology with its need, in particular, for real-time access to a wide range of information sources (for example, current share prices and trends, economic and political developments). The industry employs automated monitoring and trading applications (see below).
Note that the emphasis in such systems is on the communication and processing of items of interest, known as events in distributed systems, with the need also to deliver events reliably and in a timely manner to potentially very large numbers of clients who have a stated interest in such information items. Examples of such events include a drop in a share price, the release of the latest unemployment figures, and so on. This requires a very different style of underlying architecture from the styles mentioned above (for example client-server), and such systems typically employ what are known as distributed event-based systems. We present an illustration of a typical use of such systems below and return to this important topic in more depth in Chapter 6.
Figure 1.2 illustrates a typical financial trading system. This shows a series of event feeds coming into a given financial institution. Such event feeds share the following characteristics. Firstly, the sources are typically in a variety of formats, such as Reuters market data events and FIX events (events following the specific format of the Financial Information eXchange protocol), and indeed from different event
technologies, thus illustrating the problem of heterogeneity as encountered in most distributed systems (see also Section 1.5.1). The figure shows the use of adapters which translate heterogeneous formats into a common internal format. Secondly, the trading system must deal with a variety of event streams, all arriving at rapid rates, and often requiring real-time processing to detect patterns that indicate trading opportunities. This used to be a manual process but competitive pressures have led to increasing automation in terms of what is known as Complex Event Processing (CEP), which offers a way of composing event occurrences together into logical, temporal or spatial patterns.
This approach is primarily used to develop customized algorithmic trading strategies covering both buying and selling of stocks and shares, in particular looking for patterns that indicate a trading opportunity and then automatically responding by placing and managing orders. As an example, consider the following script:
MSFT price moves outside 2% of MSFT Moving Average
MyBasket moves up by 0.5%
HPQ’s price moves up by 5%
MSFT’s price moves down by 2%
any 2 minute time period
This script is based on the functionality provided by Apama [www.progress.com], a commercial product in the financial world originally developed out of research carried out at the University of Cambridge. The script detects a complex temporal sequence based on the share prices of Microsoft, HP and a basket of other share prices, resulting in decisions to buy or sell particular shares.
This style of technology is increasingly being used in other areas of financial systems including the monitoring of trading activity to manage risk (in particular, tracking exposure), to ensure compliance with regulations and to monitor for patterns of activity that might indicate fraudulent transactions. In such systems, events are typically
intercepted and passed through what is equivalent to a compliance and risk firewall before being processed (see also the discussion of firewalls in Section)
Frequently Asked Questions
- Difference Between Manual And Automated System - Manual System vs Automated System
- System definition and concepts | characteristics and types of system
- Real-life Business sub-systems -Production, Marketing, Personal, Material, Finance
- Systems models types of models - Systems environment and boundaries
- Real Time And Distributed System
- Basic Principles Of Successful System
- Role and need of systems analyst
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- System Analyst As Change Of Agent , Investigator and Monitoring Guy , Architect , Psychologist , Motivator , Intermediary
- System development life cycle (SDLC)
- Various phases of development - Analysis, Design, Development, Implementation, Maintenance
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