Ultra-low latency direct market access

Ultra-low latency direct market access is a set of technologies used as part of modern trading strategies, where speed of execution is critical. Direct market access (DMA), often combined with algorithmic trading is a means of executing trading flow on a selected trading venue by bypassing the brokers' discretionary methods. As defined by the International Organization of Securities Commissions (IOSCO), DMA arrangement is a process by which traders transmit orders on their own, without any handling or re-entry by another person, directly into the market’s trade matching system for execution.[1] Because of the lack of interaction with the broker, this is sometimes referred to as no-touch. DMA flow passes directly through the DMA gateway and onto the venue while passing through strict risk checking and position keeping algorithms. It is at this point that brokers may monitor the behaviour of their DMA clients.

  1. ^ Udatha, Bhanu Chandar, Report on Direct Market Access and Ultra Low Latency Trading Facilities in India (March 23, 2011). Available at SSRN: http://ssrn.com/abstract=1795782