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Computer Trading’s Next Billion-Dollar Trick: Super-Fast Flash Storage

fusionio

In the arms race between rival  firms who use computer trading to make big profits, there’s a new weapon: Flash drives, in place of hard disks.

Like it or loathe it, billions of dollars are made and lost every day on the world’s stock markets by computers. Now Fusion IO, which makes superfast flash-based RAM drives, says its products can result in acceleration of automated stock trading by a factor of five. Though we should take Fusion’s word with a pinch of salt, that figure is astonishing, representing the chance for trading firms to get sales and purchases in much quicker. This could easily lead to a difference in balance, in the long term, of billions of dollars.

Computer trading works a little like this: A PC sucks in data about real-time stock prices. It monitors a host of different parameters in a bunch of algorithms that result in a “sell” or “buy” decision on a fast-moving stock. In microseconds, money can be transferred into a stock–and turned into a profit. Moving the data around the PC is one bottleneck in this process. If the algorithms look-up tables of data to help their decisions, you’d want this data available ASAP.

Which is where flash storage comes in. Apple’s new MacBook Airs squeeze decent performance out of aging processors by marrying them with flash storage (a move which could see Apple abandon all spinning disk tech in 2011). Fusion IO says its drives have 100 times the storage capacity of traditional DRAM memory chips, and 1,000 times the performance of hard drives.

Cue a scramble for purchase of advanced flash storage, microseconds from now.

To read more news on this, and similar stuff, keep up with my updates by following me, Kit Eaton, on Twitter.KE