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In the context of computers, we use the term latency to describe the amount of time after we put in a command, the results of which appear on the monitor. Technically, this is the measurable delay associated with the transfer of a packet or datagram from one to another hardware location. We can get better network or device performance if the latency is lower. Essentially, lower latency means faster networks and better performance. Many factors cause excessive latency times or delays and describe how well network's each functional part performs. Just as things can bring about traffic blockage on highways and roads, computer networks get slow due to congestion, processing speeds, and insufficient routing.
Speed Requirement:
While some industries can allow the type of obstructions that a network of high latency provides. For example, a business that may sell shoes cannot get affected by slow computer networks with delays in sending sales reports to other stores. However, others cannot, such as financial sectors and banking. The ups and downs in financial markets, and we make decisions regarding billion dollars every day. However, traders and financial institutions rely on very accurate and up-to-date data to make a profit. Their base should be upon the real-time system, not a few seconds of old information. Investment banks and stock exchanges aim for a "Zero Latency" networking system, meaning there are no delays.
Impact of Latency on Trading:
Concerning international trade company FXCM, high latency's impact on stock dealers who regularly utilize the financial network can be significant. When we decide to sell or buy a stock, we rely on an efficient network of computers to access recent market information, submit an order, and later see that order accomplished. In the present day's world of algorithmic trading, high-frequency delays can cost a person or company a million dollars.
Its Future Significance:
According to the online news website Telecomnewsroom.com, large corporations are investing heavily in building the commercial infrastructure for the coming days. The importance of low latency is as significant today as ever. Moreover, the financial circle demands an increasingly dependable "light speed" network to build transactions.
In reply to the first question in the description, latency is significant in the financial network because stale data is unnecessary in banking and trading. Even minor delays or inaccuracies in data because of a delay lead to wrong decisions or dealings that the investors make, which means the distinction between losing or gaining vast amounts of money is essential to the achievement of all involved parties. Since 2001, we have seen M2 fiber optics as a settled manufacturer and creator of professional fiber optic platforms for optical network modeling, latency/fiber optic time delay, education, and demonstration implementations. Our client base includes the world's best-renowned telecom service providers, data centers, equipment manufacturers, financial institutions, web service suppliers, government agencies, and research institutions.
