The Shanghai markets are notoriously volatile, with stocks known to rise and fall more rapidly than other markets.
So there’s high volatility, great news! How can you ensure you can access this market faster and more reliably than anyone else?
Here are four questions you can ask to ensure you have the best connectivity into Shanghai for you and your trading objectives:
1. Do you have the need for speed?
Brokerages and electronic trading firms are constantly running into slow transaction speeds while operating in China, especially during peak hours with increased Internet traffic.
In the fast-paced world of high-frequency trading, time is literally money.
This is why having the lowest possible latency across our leading London-Shanghai route is a must for the international trading community. Every millisecond counts, and with MiFID II just around the corner, the voice to computer-based trading shift is gathering increasing momentum.
2. Is bandwidth important?
In a highly volatile market with constant changes to regulation, market structure, and government restrictions like the Great Firewall of China, the ability to scale network bandwidth up or down is increasingly important.
For brokerages working on the London Metal Exchange and the Shanghai Futures Exchange, pre-empting market events such as the annual slowdown that occurs around Chinese New Year is vital.
Trading volumes drop as Chinese investors go on holiday and then inevitably spike again when they return. Can your network cope with and anticipate such changes without impacting your business?
3. Do you need 24/7 up-time?
As well as the Chinese market representing high volatility and opportunity, the FX market has an average daily trading volume exceeding $5 trillion, making it the largest and most liquid market in the world.
The FX market represents enormous opportunity for traders as it’s a largely decentralised global market, open 24 hours and essentially unregulated.
Back-up routes and diversity will enable round-the-clock trading. Even when one line goes down, your low-latency back-up route can take over to ensure you don’t miss out on trades
4. How familiar are you with Chinese regulations?
For businesses with an established customer base in China, keeping abreast with regulatory changes is crucial.
Latency-sensitive financial customers working in this region can easily lose trading deals due to the slow, fickle nature of sending data through the country’s firewall.
Specialised market knowledge drives our pre-emptive engineering and technical know-how.
With the Chinese government’s clampdown expected to cause disruption throughout the year, our customers rest easy knowing we are doing the heavy lifting behind the scenes.
So, what’s next?
Trading in China is often complex. It requires a network which is fully diverse and highly available as well as a support team who are familiar with the local environment and have unrivalled knowledge of the diverse cable systems available.
International derivatives and FX broker, Sucden Financial, selected BSO to solve their connectivity challenges in Asia, read more.