NE V E R M I ND Y E S P LE A S E Ho m e News Case S tu d i...
Transcript of NE V E R M I ND Y E S P LE A S E Ho m e News Case S tu d i...
1/17/2017 how it helped ncdex switch over to a nextgen trading and surveillance system, IT News, ET CIO
http://cio.economictimes.indiatimes.com/news/strategyandmanagement/howithelpedncdexswitchovertoanextgentradingandsurveillancesystem/565… 1/8
An initiative of The Economic Times
A A
Share 1 Tweet
Leading commodity bourse NCDEX has switched over to anew trading and surveillance system called 'NextGen' for itsfutures and forward segments. The NextGen project isNCDEX’s biggest project till date with 2 core systemsmigrating to a completely new product and correspondingchanges to 18 downstream systems. In an interview withETCIO.COM, Anand Iyer, Chief Information Officer, NCDEXnarrates the story of deployment of the Next Gen trading
IT News / Latest IT News / Strategy & Management
How IT helped NCDEX switch overto a NextGen trading andsurveillance systemIn an interview with ETCIO.COM, Anand Iyer, Chief Information Officer, NCDEXnarrates the story of deployment of the NextGen trading platform and how his teammanaged a project of such magnitude.
Sneha Jha | ETCIO |
Sign in/Sign up NEWS SITES
ETCIO.com
Home News Case Studies Industries TechTalk CIO Wall Secret Diary of CIO CIO TV
ETCISO.in Brand Solutions
Internet of things Security Cloud Computing Strategy & Management Business Analytics Big Data
Services & Apps Consumer Tech More
Strategy & Management » trading platform NextGen Next Gen Tech NCDEX Millennium Technologies fix
Anand Iyer
January 16, 2017, 09:53 IST
NewsletterShare 257 Share 140
Your Email
Join Now!
Subscribe ETCIO Newsletter50000+ Industry Leaders already read it everyday
Stay updated with the latest news in the ITsector with our daily newsletter
50000+ Industry Leaders already read it everyday
Your email Subscribe Skip this
YES PLEASENEVER MIND
Get Notifications from ETCIO.comStay updated with the latest news in the ITsector
1/17/2017 how it helped ncdex switch over to a nextgen trading and surveillance system, IT News, ET CIO
http://cio.economictimes.indiatimes.com/news/strategyandmanagement/howithelpedncdexswitchovertoanextgentradingandsurveillancesystem/565… 2/8
platform and howhis team manageda project of suchmagnitude.
NCDEX hasswitched over toa new trading andsurveillancesystem called'NextGen' for itsfutures andforwardsegments. Whatas the businessimperative behindthe move?
NCDEX wascreated by NSEand ICICI Bank in
2003. Most of its systems, including the trading andsurveillance system were inherited from NSE. At that time,NSE systems were already 13 years old. By the time NCDEXfinished 10 years, it was running a 23 year old system.
In 2014, the exchange decided to revamp its tradinginfrastructure with a stateoftheart, worldclass architecture.Around this time, NCDEX also envisaged new products thatwere to be launched. Moreover, with SEBI taking over theCommodity markets, it was only a matter of time before newproducts like Options were allowed in the market. To be ableto meet these challenges, NCDEX decided to upgrade itscore infrastructure to cater to growing market demand.
NCDEX always has been at the forefront of governance andcompliance. With SEBI taking charge, NCDEX wanted to bein a good position to put in place business rules that make themarket place better and stronger. The new systems wouldhelp NCDEX put various validations to ensure SEBIguidelines were adhered to.
Most Read
Tata Motors CIO JagdishBelwal quits, joins GETransportation Jagdish
Belwal hasjoined GETransportationin the roleof
Digital will disrupt insurance the …
What insurance industry CIOs pr…
How IT helped NCDEX switch o…
Automation to result in job losse…
This Week
This Month
Most Read in Strategy &
Do Big Stories Articles
Leaderspeak
ShreeCementadoptsIIoT toReadMore
VirtualReality –In thedriver’sReadMore
AgarwalMoverschangesthe faceRead
KNOW MORE FROM DO BIGSTORIES
Shree Cementadopts IIoT tobetter manageits logisticsDo Big Stories:Webisode 13
Stay updated with the latest news in the ITsector with our daily newsletter
50000+ Industry Leaders already read it everyday
Your email Subscribe Skip this
YES PLEASENEVER MIND
Get Notifications from ETCIO.comStay updated with the latest news in the ITsector
1/17/2017 how it helped ncdex switch over to a nextgen trading and surveillance system, IT News, ET CIO
http://cio.economictimes.indiatimes.com/news/strategyandmanagement/howithelpedncdexswitchovertoanextgentradingandsurveillancesystem/565… 3/8
The NextGen project is NCDEX’s biggest project till datewith 2 core systems migrating to a completely newproduct and corresponding changes to 18 downstreamsystems. From a business standpoint, what did it entail ?Can you take us through the course of implementation?
The road to implementation was very tough, keeping in mind,that not only the Exchange had to change its core systems, italso had to change the 18 downstream systems, that derivedits data from the main trading engine. Moreover, NCDEXdecided to upgrade the market infrastructure by giving theinternationallybenchmarked Financial Information Exchange(FIX) protocol, as the only messaging standard tocommunicate to the market. This meant that along with theExchange, all brokers also upgraded their trading software tointerface with NCDEX over the FIX Messaging standard. Theentire project now assumed gigantic proportions!
Upgrading NCDEX to a FIX infrastructure meant that brokerscould now employ international front end systems, as thatsoftware were already FIX compliant. Moreover, the FIXmessaging standards give better flexibility and security to thetransactions that are conducted on a daily basis.
The Exchange employed the “risk upfront” philosophy, whereinstead of waiting for an event to happen and itscorresponding risk to play out, the Exchange forced the eventto mitigate the risks upfront. This would mean that any factor,due to which something could go wrong, was made live,before the new trading engine went live. It was like learning to drive on the road, before being given adriver’s license.
The market realized the benefits and helped tremendously. Atotal of 12 mock sessions were conducted in which all brokersparticipated. There were monthly meetings kept with theSoftware Vendors who were coached into adjusting with thenew FIX format. As a result, the Golive was a nonevent andtill date, no production issues or downtime has happened onthe Trading or Surveillance systems.
The NextGen Project involved three simultaneous
Digital willdisruptinsurance theway it disruptedthe travel
industry: Martijn de Jong, ChiefDigital Officer, Aegon LifeInsurance
What insuranceindustry CIOspredict aboutinsurtech in2017?
How IT helpedNCDEX switchover to aNextGen tradingand surveillance
system
Automation toresult in joblosses: MphasisCEO GaneshAyyar
Ad. FastrackWatches Up to60% off
Most Read in Strategy &Management
This Month
Sponsored by F…
This Week
Stay updated with the latest news in the ITsector with our daily newsletter
50000+ Industry Leaders already read it everyday
Your email Subscribe Skip this
YES PLEASENEVER MIND
Get Notifications from ETCIO.comStay updated with the latest news in the ITsector
1/17/2017 how it helped ncdex switch over to a nextgen trading and surveillance system, IT News, ET CIO
http://cio.economictimes.indiatimes.com/news/strategyandmanagement/howithelpedncdexswitchovertoanextgentradingandsurveillancesystem/565… 4/8
migrations. How did you manage the ensuingcomplexity?
In 2015, NCDEX signed up with London Stock Exchange(LSE) owned, Colombobased, Millennium TechnologiesSoftware. The project involved a technical migration to a newtrading and surveillance platform provided by MillenniumTechnologies.
It required a functional migration introducing a new SimplifiedSpreads contract having different business rules, that wasmade available in the new engine only.
The project also entailed a market migration. The new tradingengine was made available in FIX Protocol only, forcing themarket participants to migrate their front office systems to amore modern FIX protocol. Other exchanges had made thenew trading engine available on both, the old and the newprotocols, in order to avoid a simultaneous market migration.
We didn’t have a choice of not doing all three migrationstogether. Our trading system was more than 20 years old, sowe had to replace it. Moreover, the business also needed tointroduce new products for the market. And we did not havethe luxury of handling two communication protocolssimultaneously.
How did IT achieve the feat?
The main mantra for IT to achieve this feat was “extremecollaboration”. IT team at NCDEX was working with MIT, anew partner. It was important to establish trust between bothteams considering the nature and gestation period of theproject.
The “Risk Upfront” philosophy made the exchangecollaborate early with thirdparty software vendors as well asdata feed providers like Reuters and Bloomberg. All partnersappreciated the handholding provided by the NCDEX ITteam in order to make them successfully connect to the newtrading engine.
Stay updated with the latest news in the ITsector with our daily newsletter
50000+ Industry Leaders already read it everyday
Your email Subscribe Skip this
YES PLEASENEVER MIND
Get Notifications from ETCIO.comStay updated with the latest news in the ITsector
1/17/2017 how it helped ncdex switch over to a nextgen trading and surveillance system, IT News, ET CIO
http://cio.economictimes.indiatimes.com/news/strategyandmanagement/howithelpedncdexswitchovertoanextgentradingandsurveillancesystem/565… 5/8
A A
Share 1 Tweet
What are some of the benefits you hope to realize withthe NextGen Trading and Surveillance systems?
The NextGen system is among the country’s fastest tradingsystems. It will bring a more dynamic experience to users,with features such as tickbytick broadcast and ease ofexecuting complex trading strategies. It will speed up to orderexecution by five times. So it will bring greater convenience,speed, safety and transparency to the market.
Fortified with a large processing capacity of 1,000 orders persecond, the NextGen system supports FIX protocol, which isthe industry norm. Built on highly specialized fault¬toleranttechnology, its replica processes ensure uninterrupted tradingeven in the face of software or hardware outages
The NextGen trading platform will also be better suited tooffer products such as options and indices, besides havingenough capacity to handle algorithmic trading (highfrequencytrading). Additionally, it will be able to execute regulatorychanges more quickly and costeffectively, which will assist inefficient intraday closure, preorder checks and order flowmonitoring.
The new Surveillance system gives ample flexibility forNCDEX to monitor markets realtime, detect trading patternsand address them instantly.
Costs have also gone down with the new systems having anopen architecture. The earlier system was a mainframeequivalent system that had high maintenance costs.Additionally, the new systems require less maintenance andmonitoring leading to reduction in operational expenses
NewsletterShare 257 Share 140 Stay updated with the latest news in the IT
sector with our daily newsletter
50000+ Industry Leaders already read it everyday
Your email Subscribe Skip this
YES PLEASENEVER MIND
Get Notifications from ETCIO.comStay updated with the latest news in the ITsector