Up in the cloud

How the JSE’s expanded colocation project is helping transform the market

Up in the cloud

In the world of modern trading, fast isn’t fast enough. In 2014, the JSE launched its own on-site colocation centre, giving clients blink-of-an-eye connectivity to the exchange. The location was crucial to its speed and its success, says Langa Manqele, JSE Head of Equities and Equity Derivatives. ‘Because of the high demand in terms of split-second latency, traders cannot afford to use a generic data centre,’ he explains. ‘You have to be where the trading engine is.’ Indeed, with their trading equipment located in the JSE’s data centre, the average round-trip colocation network latency is barely 20 microseconds over a calendar month on business days during trading hours.

Now, owing to high market demand, the JSE has expanded its cloud-based colocation service into Colo 2.0. This expansion is an international collaboration with Beeks Group, a UK-based managed cloud computing and analytics provider for global financial markets, and IPC Systems, a US-based provider of electronic trading solutions. ‘The launch of Colo 2.0 will further entrench our position as a centre of innovation for financial markets on the African continent,’ says Manqele. ‘We will provide our clients with leading-edge innovative hosting and connectivity solutions for their colocation needs. This collaboration with two global market leaders is paramount to fostering innovation at the JSE.’

Manqele emphasises that the colocation centre will be managed by the JSE’s own team, with its own power supply, back-ups and cooling system. ‘Because of the need for us to ensure availability of the service, it is best that we as the JSE have oversight of our own data centre,’ he says. ‘We can’t afford to have our data centre run by a third party. This is very much an exchange-owned data centre.’

He adds that clients will now be able to access on-demand private cloud computing and low-latency analytics packaged within Colo 2.0, using an industry-leading private portal to self-manage and configure infrastructure. By offering a branded cloud service in its own facility, and by controlling that infra-structure easily at scale, the JSE has also turned a cost centre into a profit centre. The project is being delivered from Beeks’ existing stock supplies, which means there is no need for a cash investment to fulfil the contract.

Colo 2.0 provides on-demand computing and analytics capabilities that allow the JSE to provide its clients with a cutting-edge infrastructure-as-a service solution with a fully configured, pre-installed environment. The multi-tenant solution reduces time to market and total cost of ownership, while also offering PTP (precision time protocol) time stamping, improved flexibility and scalability, a built-in analytics server and a single point of contact for support and invoicing. The service also empowers the JSE to directly mitigate the costly challenges that clients often face, such as monitoring, hosting, maintenance and time-to-market concerns.

Colo 2.0 is a massive leap forward for Africa’s largest bourse, and for trading in the region in general. And as one of the fastest-expanding economic regions globally, the role of Africa’s capital markets for economic development has never been more critical. Manqele sees Colo 2.0 as a significant aspect of the JSE’s strategy to advance its growth across services, and to build the JSE’s already impressive suite of services as the largest stock exchange in Africa. ‘As our business evolves in line with the needs of our clients, we continue to work even more tirelessly to partner to bring them enhanced and speedier services that can enhance and add value to their businesses.’

By Mark van Dijk
Image: Gallo/Getty Images