Protocols used by stock exchanges

Question

My career goal is to work as a software developer for an online stock broker website or for a stock exchange. I am curious about the protocols used by the stock network. For example, what protocol does an online stock broker website use to send a sell order to a stock exchange?

Thanks.

Answer 1

There are many and various:- FIX - is used for messages between brokers, investment banks financial advisors etc. it has many message types such as "quote", "offer", "accept", "buy" etc. so that the various houses can negotiate and trade on an automated basis.

Each stock exchange NASDAQ,AMEX,FTSE, etc. etc. has its own proprietary protocol (and perhaps more importantly PROCEDURES) for automated trading.

Rueters, Bloomberg, etc. etc. have their own proprietary protocols for providing market information.

Each regulator such as the Securities Exchange Commission, has its on protocol for filing and querying company statements.

Then many "ordinary" financial protocols such as SWIFT for international business, ISO 8583 for credit card payments and whatever interbank payments system is supported in the countries the house operates in.

Just to complicate things a little further many widely used products such as the MUREX trading family or the FERMAT risk management products use there own APIs which are regarded as "standard" in the same way as MS Word is standard.

And to top it all most of the bulge bracket banks have in house written "backbone" applications which use private inhouse protocols.

An understanding of the underlying business of the group you are supporting (and these teams can be absurdly specialised ) is probably more useful. Deal with the various protocols on a "need to do" basis.

Answer 2

One protocol that I am familiar with is FIX. The site has lots of tools for implementing your own libraries as well unit testing. There are probably others, but this is one of them.