The Financial Information eXchange (FIX) Protocol is a messaging standard developed specifically for the real-time electronic exchange of securities transactions. FIX is used by financial trading firms and markets to communicate financial transactions, among other information. FIX is a free and open protocol, reducing important barriers to adoption. Open source implementations are available. A list of adopters provided by the industry group, FIX Protocol Limited lists hundreds of the largest financial firms in the world.
How does FIX work on the network?
FIX typically runs over the TCP/IP protocol. Each message has a header that defines the type of the enclosed message body and concludes with a trailer that contains validation information such as a checksum. Because field delimiters are quite brief the messages consume less bandwidth than XML tagged protocols of comparable information content.
How does FIX optimize the timely delivery of financial transactions?
Financial transactions executed using FIX are dependent on the speed and reliability of the underlying network layers. The best-effort nature of the TCP/IP protocol normally makes it impossible to guarantee timely delivery of FIX messages, which may cause transactions to become stale and unable to be executed. To avoid this kind of problem, financial firms - and the communication service providers they use - need to be able to emulate or simulate expected network impairments to validate that messages are delivered within some allowed constraint. Otherwise they would be unable to know what Service Level Agreements (SLAs) they could honor under edge cases. Typical problems that need to be emulated are bandwidth limitations, packet drops, delays, duplicates, and jitter that might occur within some desired range of probability; this is "What is the maximum range of impairments we can allow to satisfy desired levels of message delivery 99.99% of the time?" Emulation tells you whether you need to concentrate your resources on more bandwidth, lower latency, shorter queues in routers, and so on.
How can I emulate "worst case" FIX conditions?
All the Maxwell products are able to accomplish all these emulations. The Maxwell Pro product includes a collection of impairment suites based on statistics from real world observations (from the ITU G.1050 documents.) The Maxwell emulators can also be made to vary their impairments over time so as to emulate changes in network congestion throughout the trading day.