Lime Brokerage is rolling out an execution service for high-frequency trading firms to enable the trading firms to collocate at U.S. trading venues without violating the trading limits imposed on sponsoring brokers.
Based on patent-pending technology, the new service known as LimeInside, incorporates pre-trade order validations and other pre-trade risk controls including stock locate, short sales validation and margin calculations, with single digit microsecond latency.
“It happens to be the best solution in the market in terms of speed and raw performance and reliability,” contends Jeffrey Wecker, CEO of Lime Brokerage, an independent agency broker known for its high-throughput low latency technology.
Lime contends the new service will meet or exceed the anticipated requirements for sponsored access that are likely to evolve from the SEC’s pending ban on naked access. That piece of proposed regulation is out for public comment until next Monday. But there is an expectation that the SEC will clarify the rules on sponsored access, once it digests the industry’s comments, mandating that sponsoring brokers implement pre-trade order validation technology.
According to Wecker, the LimeInside suite of services is designed for firms that are going to collocate at an exchange’s data center. “This is a programmatic layer that sits inside their proprietary algorithmic server and gives them high-speed access to the exchanges’ local match engines, while still satisfying the need for pre-order risk control and various other pre-order validations that are necessary in a fast and efficient way prior to the match, explains Wecker.
Initially, Lime will offer LimeInside to a select number of firms that want sponsored access to Nasdaq, NYSE Arca and BATS, which are the markets where people have been using naked access, noted Wecker. The subsequent phase will cover Direct Edge and the NYSE, which is weeks away from launch.
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