Choosing Your FIX Engine

26 Oct Choosing Your FIX Engine

Your FIX engine is software that manages your network connection, parses and creates messages going out and coming in, and recovers should something go wrong. This software is what manages the application layers and your sessions, and it is the sole piece of software you need for your order management system and FIX-enabled trading.

In basic terms, your engine is your interface to the outside world. In combination with a network, it can allow you to exchange and trade related information in a standard format. Your application is FIX-enabled with the addition of an integrated engine and a connection to the routing network.

What is the Difference Between the Various Engines?

These engines basically do the same things, but they differ in three distinct ways: their capabilities, the technology used, and the services and support offered.

When it comes to capabilities, consider which versions of FIX the engine supports, whether it supports asset classes outside of equities, how scalable it is, what other programs it supports, and the level of speed offered. You’ll also want to check out each engine’s encryption options and review how easy it is to add support connections to other counterparties.

For technology used, find out how many FIX platforms the engine can run on as some are designed to run optimally on one specific platform only. A flexible architecture is preferred, and you’ll also need to know how the implementation works. Some engines offer an easy implementation, but this could come at the cost of flexibility. On the other hand, engines that are harder to implement may offer more flexibility.

Last but certainly not least is the support and service offered with the engine. Some offer access to the source code so you can make modifications, but this is only a concern if you feel you may need to do so. Support should be available at all times in multiple formats, and you’ll want to see if on-site support is available, too. Find out how many upgrades and updates you’ll get with your license and what you may have to pay for. Ask the provider what the response steps are should a disaster occur and what you’ll pay for emergency support and recovery services if something goes wrong.

Other Crucial Factors

You’ll need to consider pricing when it comes to your engine; it needs to be affordable and within your budget. If cost is a major barrier, speak to the vendor and see how flexible they are about payment methods and terms.

Naturally, security and stability are vital for your engine, so you’ll need to evaluate the tools that are available to monitor your FIX sessions with the engines you’re considering. Features such as a comprehensive error translator, for example, will save you countless minutes that would otherwise be wasted trying to understand an error message.

Ultimately, the right engine for your trading depends on many things, including what you can afford and your specific needs. Take the time to research all your options so you know what you’re getting and aren’t faced with unexpected obstacles during your daily trading after implementation.

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