The National Stock ExchangeInfrastructure and FIX Preparedness

April 13, 2010

Vidhu ShekharNational Stock Exchange of India Limited

Copyright © 2009 National Stock Exchange of India Ltd.

Topics

• Historical Recap

• NSE Today

• Market Needs

• Infrastructure and Network

• NSE’s FIX Preparedness

• Conclusions

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Historical RecapPre 1994• Low Transparency

• Low Reach

• Weak Risk Management

• Long Clearing & Settlement Cycles

• Paper Intensive

• Physical Share Certificates

Post 1994• Full Transparency

• Nation Wide Reach

• Real Time Risk Management

• T+2 Clearing & Settlement Cycles

• Electronic Matching

• Full De-materialization

• F&O, Currency & IRF

• Real Time Cross Margining

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Three Factors Driving Development

RegulationWhat is

Permissible

TechnologyWhat is Feasible

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Reliability ChallengeNSE Today

• Nationwide High Resiliency High Bandwidth IP Backbone Infrastructure

• 6,000+ connections (Both Terrestrial and Satellite)

• 1,500+ Locations

• 1,000+ Members

• Processing about 100 Million messages and 10 Million trades every day

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Market Needs – Faster, Cheaper, EasierTechnology• Reliability• Recoverability• Throughput (Capacity)• Scalability • Low Latency• Wide Spread Reach (Network

Connectivity)• Low Transaction Costs• Business Continuity• Business Intelligence

Product Capability• Transparency• Rich Functionality• Liquid• Depth• Resiliency• Low Impact Cost• Real Time Risk

Management

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Nationwide POP Topology

Multiple STM4

AmdavadPOP

Primary Data Center

ChennaiPOP

Business Continuity

Data Center

2

DelhiTwo POPs

1

32

Mumbai Three POPs

1

RajkotPOP

2Kolkata Two POPs

1

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POP Connectivity for Members

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NSE’s FIX Preparedness• FIX Version 4.2 used as it is the current preferred version for

Sell Side Firms with plans to move to FIX 5.x as needed• Minimal deviation from FIX Protocol 4.2• Specific Custom messages for

– Multi Leg Orders – Exercise of Options– Give up reports

• Market data not implemented in FIX, will continue in our current proprietary format

• Beta testing in progress for Cash, F&O and Currency Derivatives segments

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FIX Connectivity to NSEForeign

Institutional Investors Domestic

Financial Institutions

FIX Hub

NSEOther

Exchanges

Various Members

with CTCLsNOW

DMAFIX

DMAFIX

NSE TAP

FIX Gateway

TerrestrialNetwork10 POPs

VSAT NetworkInternet

DMAFIX

DMAFIX

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Conventional Flow

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ExchangeBuy Side Firm

Sell Side Firm

Data Vendor

Exchange

Exchange

News

DMA – Direct Market Access

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ExchangeBuy Side Firm

Sell Side Firm

Data Vendor

Exchange

Exchange

News

ALGO Trading

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ExchangeBuy Side Firm

Sell Side Firm

Data Vendor

Exchange

Exchange

News

Co-Location

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Conclusion• We will continue to bring New and Innovative

Products to meet and exceed market expectations

• We will continue to provide Best-of-Breed Solutions to the market participants -proactively and also as requested by the participants

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Thank You

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