PHLX Takes 'Iron' Network Live

PHILADELPHIA—The Philadelphia Stock Exchange (PHLX) last week launched its Institutional Regional Optical Network (Iron), a single point of entry for PHLX offerings, which runs on Juniper Networks M-series routers, say exchange officials.

The Iron network offers connections to various PHLX offerings like the PHLX XLE equity trading system, the PHLX XL options trading system and the PBOT XL futures trading system.

"The idea was to make connectivity as easy and as fast as possible," says Bill Morgan, executive vice president and CIO at PHLX. "There is no reason to have multiple connections to multiple other types of infrastructure" when this single point of access is available. PHLX kicked off a test of Iron several weeks ago to "make sure it was stable," Morgan says.

The exchange launched its equity-trading PHLX XLE platform in November 2006, leveraging the features of its PHLX LE options-trading platform. The move effectively shut down the Philadelphia Automated Communication and Execution (PACE) system, which supported floor-based specialists (DWT, Nov. 20, 2006).

The exchange announced last year that it would move from a floor-based equity exchange to a fully electronic one (DWT, Jan. 16, 2006). The move came after PHLX officials announced in 2005 that the exchange intended to bolster its equities systems as part of its bid to stand up to the "duopoly" of the New York Stock Exchange (NYSE) and the Nasdaq Stock Market (DWT, Aug. 22, 2005).

Iron has four co-location sites throughout New York, New Jersey and Philadelphia. PHLX has a hosted site for its main servers in Weehawken, N.J., a main hub in lower Manhattan, and two hubs in Philadelphia, Morgan says.

"There was a driving demand to get our execution times down to as fast as possible, and the only way for us to do that was to put in place this new network concept and co-locate our facilities," Morgan says.

The PHLX last year broke ground on a new datacenter within the Philadelphia Naval Shipyard. The 26,000-square-foot facility is about five miles from the exchange's headquarters.

Morgan expects to begin migration of equipment to the Naval Yard site by the beginning of 2008. It is intended to serve as the exchange's main datacenter and will replace those datacenters housed on three separate floors at the exchange's current location (DWT, Sept. 4, 2006).