After “Building an Investment Bank’s Technology from the Ground Up” the question I got asked the most was: “How much did that cost?”.
The traditional approach to building trading systems in Investment Banks is to sign a variety of expensive licensing agreements with software vendors for Databases, Application Servers, Operating Systems, Message Brokers/Appliances, Reporting Tools, etc.
In our case the answer is: $0
The ROI for an average Investment Bank’s technology investments is extraordinarily low. There are small pockets of excellence in all banks but most technology organizations are buying vendor products they do not need in order to build things that do not work for their businesses. A tremendous amount of money is wasted on outsourcing and off-shoring arrangements as well as with your traditional big ticket software vendors: Oracle, Tibco, CA, IBM, VMware etc.
“The Matrix is the world that has been pulled over your eyes to blind you from the truth.”
By mastering modern software development techniques and best of breed Open Source technologies we delivered the following with a total software licensing cost of zero dollars:
- Stream processing at a rate of over 400,000 events per second
- Distributed and fault-tolerant data storage and replication capable of 1,000,000 writes per second
- Metrics: Currently at 360,000 events per minute
- A variety of compute grid prototypes with two implementations deployed in production: extreme scalability, low latency, full fault-tolerance, low jitter
Fifteen years ago this would not have been possible without significant help from vendors and consultants but with the right team and tools in place it is possible to achieve this with a total out of pocket software license cost of zero dollars.
This has significant implications on the extent to which IT/infrastructure operating budgets could be reduced.
“Have you ever had a dream, Neo, that you were so sure was real? What if you were unable to wake from that dream? How would you know the difference between the dream world and the real world?”