IPC Systems is rolling out a financial extranet service called Connexus to provide buy and sell side firms with connectivity to trade lifecycle services.
“The focus is on an extranet that brings together a community of interest and a wide variety of applications. It’s less about speed and more about life cycle services,” said Ganesh Iyer, IPC’s product management in an interview with Wall Street & Technology earlier this week. Iyer was in London this week to announce Connexus. Next week, the company will officially launch the service in New York, he said.
According to Iyer, IPC’s new data connectivity service will meet the needs of capital markets firms, including those on the buy and sell sides, interdealer brokers, liquidity venues, clearing and settlement firms as well as application and market data providers.
IPC is bringing on application providers such as order management systems (OMS) and execution management system (EMS) vendors, order routing specialists, market data vendors, FX platforms, exchanges, ECNs and clearing firms. A number of the providers are in the FX market, said Iyer,, noting they would help hedge funds and proprietary trading firms. However, all the major asset classes will be covered, including equities, fixed income, commodities, and futures and options, as well as over-the-counter swaps, which could become interesting once they are traded electronically under the Dodd-Frank legislation, he added.
Buy side firms will also benefit because the sell-side firms will provide access to research, said Iyer. “They can access developed markets and multiple markets but also the emerging and frontier markets.” Typically, the sell side will sponsor the cost of connectivity for the buy side, he said.
Iyer contends that IPC is uniquely positioned because of the company’s exclusive focus on capital markets and its experience. Based in Jersey City, New Jersey, IPC has focused on the capital markets for forty years as a supplier of trading turrets and voice networks with private lines. With the advent of electronic trading, it moved into data services starting out with point-to-point data connectivity, which helps with low-latency trading. Now the focus is on building data connectivity services, said Iyer.
The application providers can improve the visibility of their services. They can also promote, market and sell their services through a marketing program for ASPs, said Iyer, noting that IPC will also provide them with connectivity.
IPC is locating its equipment (routers and other gear) in data centers like Equinix and carrier networks such as at 111 8th Avenue, a New York City-based access point run by Telix. “We see Equinix as a partner. They provide us with real estate. We don’t own the data centers,” he explains.
So far, IPC’s financial markets network provides allows access to 4,000 market participants located in over 700 cities and more than 58 countries, according to the release. Most of the firms are using it for voice and high speed data connectivity. Of the total, about 100 buy side firms are using the extranet service. “It’s growing fast,” said Iyer.
One of the advantages of Connexus is that participants use a shared infrastructure. They don’t need to have dedicated lines every time they are doing something. It makes the cost more predictable,” said Iyer.
While flexibility, cost, speed and simplicity are among the benefits cited by IPC, the company is not targeting latency-sensitive firms. “You’re not trying to do high frequency trading. You’re trying to do other applications,” said Iyer.
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio