Pragmatic Approaches for Sync Delivery in Finance Markets
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The document discusses the increasing need for precise time synchronization in financial markets due to regulatory requirements for accurate transaction timestamping. It introduces 'Time as a Service' (TaaS) as a solution for financial organizations to enhance timing accuracy through upgraded network technologies. The emphasis is on combining Precision Time Protocol (PTP) with Network Time Protocol (NTP) to address timing challenges, ensuring compliance and improving overall system reliability.
Pragmatic Approaches for Sync Delivery in Finance Markets
- 1. Pragmatic Approaches for Sync Delivery in Finance Markets ATIS Time and Money, NYSE, Jan 2017 Gil Biran, SVP and GM, Oscilloquartz
- 2. © 2017 ADVA Optical Networking. All rights reserved. Confidential.2 To Time or Not to Time, That Is the Question … Do you feel that time is running faster these days ? The truth is that time stays the same. Thanks to us, it just becomes even more accurate (as is required by mobile and finance applications). 10E-12 = 0,000000000001 seconds
- 3. © 2017 ADVA Optical Networking. All rights reserved. Confidential.3 Regulators Require Extremely Precise Timestamps for Every Single Transaction • To provide accurate financial reporting - Based on proper time and event synchronization • To eliminate fraud and assure security trades - Accuracy of time and timestamping provide proof if and when a transaction occurred • To protect consumer’s data from being modified - Every access of sensitive information must be recorded for auditing with real time date and timestamp • To ensure security of card holder data - In online or retail transaction networks Inaccurate time and its consequences on financial applications may consist of legal liability for negligence
- 4. © 2017 ADVA Optical Networking. All rights reserved. Confidential.4 Time Is Money… • SEC Rule 613 issued August 2012 • Requires all actions placed on any US exchange to be recorded to accuracy of 1ms • Clock needs to be 100us or better to achieve irrefutable 1ms recording • Enables auditing in case of fraud investigation, mandatory for all financial organizations • European Securities and Markets Authority (ESMA) consultation paper Annex B Regulatory Technical Standard (RTS 25) on MiFID II • Require that the clocks of trading venues and their customers must be synchronized • Standardize the recorded time for post-trade data, transaction reporting and order event auditing • Level of accuracy for operators of trading venues requires 1us timestamping • Level of accuracy for members or participants of trading venue • Activity using high frequency algorithmic trading technique requires 1us timestamping • Any other trading activity requires 1ms timestamping or better • Algo traders want to record transaction times in order to Audit the performance of their algorithms and Analyze historic data
- 5. © 2017 ADVA Optical Networking. All rights reserved. Confidential.5 Time as a Service – TaaS • Many finance organization have already decided to upgrade their networks in order to support the new timing requirements • Operators are upgrading their networks to be PTP-capable in order to deliver accurate phase required for mobile applications (LTE- A/LTE-TDD) while proposing TaaS to the finance organization • Very accurate time needs to be delivered to trading customers in order to synchronize business/enterprise clocks • Additional potential source of revenue for operators • TaaS is provided with committed sync SLA and service portal • The accurate time delivered via PTP can be translated to NTP and be offered as a service, such a service can be used to improve installed base NTP clients time accuracy
- 6. © 2017 ADVA Optical Networking. All rights reserved. Confidential.6 PDV and asymmetry degrade the NTP recovered clock accuracy No option for BC or TC with NTP High PDV/ AsymmetryNTP Client NTP Server GNSS The Problem NTP NTP NTP Packets
- 7. © 2017 ADVA Optical Networking. All rights reserved. Confidential.7 Combine PTP with NTP by using PTP BC/TC to overcome PDV and asymmetry NTP Client GNSS The Solution PTP To NTP NTP BCTC PTP Grand Master PTP PTP Packets NTP Packets
- 8. © 2017 ADVA Optical Networking. All rights reserved. Confidential.8 12:00:00.000 12:00:00.001 12:00:00.002 12:00:01.000NTP 1PPS 1PPS rising edge strobes the value of time delivered by NTP once per second. NTP inherits the accuracy delivered by PTP. NTP NIC with 1PPS I/O Client Server OSA5420 1PPS in NTP High Accuracy PTP Time Service PTP SlaveNTP Server* 32x 1PPS Outputs OSA5420 PTP GM Concept for Install Base - NTP Server + 1PPS
- 9. © 2017 ADVA Optical Networking. All rights reserved. Confidential.9 NTP Server + 1PPS Case Study - APAC PTP Input Data Logger DB Logger Time Series Logger Trading Terminal 1PPS 1PPS1PPS 1PPS LAN Network NTP NTP NTP OSA 5420 PTP GM/NTP Server
- 10. © 2017 ADVA Optical Networking. All rights reserved. Confidential.10 OSA 5420 PTP GM GNSS Switch T-SC T-SC Server NICs Customer Rack Data Centre PTP PTP PTP Time and phase delivery using PTP enterprise profile 5420 Slave 16-32x1PPS+ToD Outputs Customer Rack T-GM GNSS PTP Grandmaster PTP Network Time As a Service into Data Center Financial Markets Bring accurate time and frequency synchronization into data centers
- 11. © 2017 ADVA Optical Networking. All rights reserved. Confidential.11 PTP PTP PTP1PPS 1PPS INDEX: BC = Boundary Clock Colocation Colocation PTP & Sync-E PTP & Sync-E PTP/NTP Data CenterPTP BC NTP 1PPS PTP Mediation Colocation 5401 Sync Distribution and Assurance for Finance
- 12. © 2017 ADVA Optical Networking. All rights reserved. Confidential.12 • Sync portal is a web-hosted application • Custom views, reports per customer/carrier • Data segregation ensures privacy between customer domains • Data collection via FSP NM or via dedicated collector appliance Sync Network FSP NM Collector Data Center Storage Syncjack Portal Secure Encrypted Communication Carrier HTTPS HTTPS Customer A A B B A Customer B Sync Portal Concept
- 13. © 2017 ADVA Optical Networking. All rights reserved. Confidential.13 • Time accuracy of NTP-installed-based clients can improved significantly by combining the following: • Upgrade of NTP servers to telecom grade NTPv4 servers • Combine PTP with NTP to overcome asymmetry and PDV • PTP to NTP transition should be done as close as possible to NTP clients • Leverage investment made for PTP to improve NTP accuracy while protecting the huge investment of NTP NIC in the client servers • You can also replace all NTP NIC with PTP NIC if your budget allows it • Sync assurance is a mandatory element of any sync solution • Explore the option to use Time as a Service Summary and Takeaways
- 14. © 2017 ADVA Optical Networking. All rights reserved. Confidential.14
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