Bolsa Mexicana de Valores (BMV) sought a scalable, flexible, low-latency, and cost-effective solution that would guarantee availability of a mission-critical application with a large number of transactions per second.
Mexico City, Mexico
Financial Services Industry
Renovate the electronic trading system for stock market operation of Bolsa Mexicana de Valores.
Existing BMV architecture
We needed to reduce costs and times without compromising the robustness of the trading engine, and Red Hat Enterprise Linux gave us the chance of not only maintaining, but also improving, its operation.Luis Carballo, software factory director, Bolsa Mexicana de Valores
After extensive research of the trends followed by leading worldwide stock exchanges, Bolsa Mexicana de Valores (BMV) started the renovation of its trading system for stock market operations. Called MoNet (Motor de Negociación Transaccional), the new system would replace the SENTRA Capitales system for Mexico-based BMV.
The most critical applications of the BMV require fault-tolerant technology. BMV developed a centralized architecture known as NonStop. With NonStop, a redundant number of processors and storage devices can quickly respond to a fault, even when the hardware fails.
Technology verged on obsolescence
Because of NonStop's robustness and architecture, when the BMV needed to make changes or alter performance capabilities, response times were limited. Cobol and C programming languages and other specialized technologies, some of which were on the verge of obsolescence, made daily support and maintenance cost-inefficient.
BMV wants 100-microsecond trade
The challenge with MoNet was to achieve levels of latency and performance similar to those seen in the best stock exchanges in the world. The BMV wanted to be able to run transactions in less than 100 microseconds each and satisfy any business rules being used.
MoNet had to be a scalable and flexible system, with independently updated individual modules. This is to reduce dependency on other systems in the exchange and optimize efficiency. MoNet must also support a large number of transactions per second and allow BMV to maintain control of the created environment.
"We needed to reduce costs and times without compromising the robustness of the trading engine, and Red Hat® Enterprise Linux® gave us the chance of not only maintaining, but also improving, its operation," said Luis Carballo, software factory director of the Bolsa Mexicana de Valores.
"The chosen solution was intended to run on par with systems being run by the world's leading stock exchanges, like the ones in New York and Asia," said Carballo.
The solution migrated languages from Cobol to Java™. Combined with Red Hat Enterprise Linux®, this makes communication through the Infiniband communications network more efficient and agile.
Open source delivers low latency, high performance
The BMV chose Red Hat JBoss Operations Network as the market index engine, where real-time CPI is calculated. Red Hat JBoss Operations Network is also used to authenticate operator's terminals and for screen configuration.
The project was completed in April 2013, resulting in a noticeable cost reduction through the use of open source platforms. "Red Hat provided us with a solution that fulfilled the main criteria: low latency, high performance, and availability—all with lower support and implementation costs," said Carballo.
Maintenance costs drop
MoNet has replaced the three main systems of the Bolsa Mexicana de Valores: one in the capital market and two in the derivatives market. This translates to a maintenance cost reduction, as updating or fixing the system of one market is useful to all three.
"Red Hat is an open system where I can easily find experts in the market. With Red Hat, I will have the support I need when I need it," said Carballo.
"MoNet has allowed us to decrease response times from 24 milliseconds to 100 microseconds, supporting 100 thousand messages per second per group of boxes," Carballo said. "Before, we were only capable of supporting less than one thousand messages per second per group."
For the BMV, improving system scalability became an investment rather than a recurring expense. The hardware used to support the engine in the current MoNet system is at least 50% more efficient, with a 240% higher throughput capacity and more flexible, scalable configurations.
System meets highest standards
The BMV now has an efficient, stable system that is in accordance with the highest safety standards. It has fast response times and a very low maintenance cost. It can connect with more and more brokers—regardless of the number of business rules that need to be accommodated.
That means the BMV is able to encourage growth of the exchange's Mexican market. Decentralizing the system has also allowed for quick detection of human errors without affecting day-to-day operations.
"The Red Hat subscription model has allowed us to grow at the pace of the number of servers we need. I can manage the subscriptions with the required flexibility to decide which servers they are needed, as well as the support level required," said Carballo.
BMV looks forward to more Red Hat products
We have been consolidating the platforms and, today, we have a large installed base of equipment running on Red Hat, and we have achieved stability for those systems," Carballo said. "We are now evaluating Red Hat JBoss technologies, which we hope will become seamlessly integrated with our infrastructure."
"We were very happy to learn that open source products could compete in quality and performance with proprietary software products. Red Hat is a company that knows how to listen to its customers' needs," Carballo said.