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Exchange Security Measures

Overview

Different exchanges use different types of security measures. Although a part of the trading system, these exchange-related security measures are beyond the scope of this manual as these measures are the responsibility of the exchange and not TT. Types of exchange security measures can include one or more of the following:

  • Exchange registration
  • EncryptionPersistent connectionsNetwork setup

Exchange Registration

To trade on an exchange, a trader must be registered or be mapped to a registered trader in Guardian. If a trader ID is not registered with the exchange, that particular trader cannot trade using that ID. To register a trader ID, the customer must call the appropriate exchange.

Encryption

Certain exchanges encrypt information sent to and from the exchange. While different types of encryption exist, the most common form is the use of key files (often referred to as mnemonics). If an exchange distributes encrypted key files (i.e., LIFFE Connect), the customer must decrypt these files before using them to connect to the exchange.

Regardless of the type of encryption that an exchange uses, the customer must call the appropriate exchange for instructions on any encryption-related tasks they must perform to connect to and trade on the exchange.

Persistent Connections

Certain exchanges use another form of security called a persistent connection that prevents the multiple use of the same trader information. When a trader first logs into the exchange, a persistent connection is created to the Order Router used by the trader on the TT Gateway. This connection persists for the rest of the day. Because the trader is allowed to log into the exchange only once, the same trader (or another trader using the same information) is unable to log into the exchange using another TT Gateway or Independent Software Vendor (ISV). The trader can, however, connect to the exchange again from any X_TRADER® workstation using the TT Gateway that hosts the persistent connection. Most often, these persistent connections break only in the event of a host, third-party device, or TT Gateway failure.

Network Setup

Several exchanges install, configure, and administer third-party devices that operate between the customer’s trading system and the exchange itself. In these scenarios, customers must use the third-party device to connect to the exchange. Examples include LIFFE Connect exchanges and MISS-based exchanges.

Third-party devices are usually separated from the customer’s network via a router or firewall. Although some exchanges may supply devices to separate the networks, customers may instead decide to supply their own network barriers. Additionally, customers can use a firewall in place of a router.