Hull Trading: Taking the Lead in Wireless Stock and Option Trading
International trading company Hull Trading actively participates in several thousand contracts per day on floors including the American Stock Exchange, the New York Stock Exchange, and international derivative exchanges in Frankfurt and Hong Kong. It's one of the most innovative companies of its kind: As early as 1992, as part of its strategy of constantly evaluating technologies that provide the maximum competitive advantage for its traders, Hull implemented its own wireless LAN system at the Chicago Board Options Exchange. Now many other Hull traders use wireless networks on trading floors throughout the world.
Application: Real-Time Information and Transactions on the Exchange Floor
For some time, trading company clerks have had communications access to their home offices through a wired network. However, many still use color-coded screens and hand signals to communicate pricing information from their booths above the exchange floor to traders on the floor, or they deliver price sheets to the traders via runners. Several years ago, Hull recognized that the old system — a manual, multipart process — didn't bring information to traders in an effective or timely way. Says Warren Langley, a principal at Hull, "We had to find a way to put networked PC capabilities into the hands of our traders."
Now, using a hand-held PC with a wireless LAN adapter, every Hull trader on the Chicago Board Options Exchange can get pricing information from Hull's database in real time — and record each transaction as it happens.
Benefits: Better Information, Better Traders; a Boost for the Whole Market
The wireless LAN lets Hull provide its traders with real-time bids, offers, and other proprietary information. By reducing the amount of time it takes to deliver the information that traders need, the wireless system enhances the skills and talents of Hull's traders: It lets the company make the highest quality trades for brokers and their investor clients. "Wireless was the final link we needed between our computer systems here and the individual trader on the floor," says Hull's Langley. "It's a key capability for Hull Trading."
Hull's use of wireless technology is good for the entire trading market, too. "The use of wireless technology in this market is a very positive development," says Langley. Hull has gone before exchange committees to demonstrate that the technology benefits customers by enabling traders to get better prices and more depth in the market. Now that most of the major exchanges are working on their own internal wireless systems for auditing and tracking trades, Hull — as one of the pioneers in using wireless technology in the trading market — can help develop optimum systems.
Installation Size
At the Chicago Board Options Exchange, 20 of Hull's traders use hand-held computers with fully integrated wireless LAN adapters; they share about 30 access points, which link them to the server on Hull Trading's wired network, with several other trading companies (use of the access points is governed by a users' group and the Exchange). The latest upgrade, installed in 1995, transmits data at a fast 1.6 megabits per second. Hull's choice of a system that allows 15 independent wireless LANs to operate in the same physical space offers dual advantages: Hull can expand its system significantly, and other trading companies can also operate their systems alongside Hull's.
