In a twist dating back to your childhood: Does money grow on trees? Well, no, obviously, but ironically – yes – money can now grow on a source code tree! You might be asking yourself “Well then smarty pants, how could you turn source code text into gold?” Luckily, for the bold, there is now the potential to create your own High-Frequency Trading Platform using Open Sourced Software. Although Goldman Sachs has announced their intentions to join the ranks of those whom had open sourced their trading platform, it will still take a lot of hard work to compete in the high stakes world of High-Frequency Trading. Regardless, it might be time to call your buddy Alfred, dust off your cape, and freshen up on your Quantitative Analysis super powers.
Back before the Financial Crisis of 2008, Goldman Sachs maintained a competitive edge by using proprietary trading engine it had called SecDB. This SecDB Software had eventually evolved into a Web Application called Marquee which is, as Goldman puts it, “The future of institutional finance”. This is the software which is soon to be released to the public, an
Why would Goldman Open Source Marquee? Likely the same reasons why other organizations have Open Sourced their Trading Platforms. “Wait,” you might say, “There are other Open Source Trading platforms!?”. Yes, yes there are.
There are numerous Open Source Trading Platforms available today including Zipline, Ninja Trader, Quant Connect, Stock Sharp, M4, Gekko, Tribeca, Lean, Backtrader and more. Be sure to remember: Not all of these solutions are created equal. If your goal is to build a High-Frequency trading platform from one of these Open Source solutions you’ll have your work cut out for you. You’ll need a combined knowledge of a Software Developer, Systems Administrator, Network Engineer, and Relational Database Administrator (~350k of combined salaries per annum). Although this seems knowledge/cost prohibitive the upside is huge – obtaining an equal footing with the largest financial institutions in the world. You’ll also have to get a redundant, low latency, high-speed network connections to the specific stock exchanges/data provider.
If you’re hesitant to utilize the freely available trading source code you can always pay ~$20,000 a year per seat for a Bloomberg Terminal or contact your bank to obtain access to their trading platform. These options won’t allow you to write custom software/automated trading/quantitative algorithms.
As time goes on there will be more open source options to consider when designing a custom trading platform. We’ve come a long way from Ticker Tape. We’re excited to monitor the situation and look forward to helping you make the most logical decision possible.