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Javelin Technologies'president discusses the future of the FIX protocol and how it will be complemented by XML.
In 1996, George Kledaras quit his job at Blackrock Financial Management, a high-tech money management firm, to bet his future on the FIX protocol and electronic trading. Today, Kledaras, president and CEO of Javelin Technologies, Inc., has 60 clients including Fidelity Management & Research and Morgan Stanley Dean Witter Online, and 100 installations worldwide in London, Germany, Australia and France. Lately, business has been booming as the rapid growth in FIX message volumes has caused some firms to redo their technology because a) they didn't make a big enough investment or b) they didn't anticipate the number of FIX connections they would need to hundreds of counterparties.
In an interview with editorial director Ivy Schmerken, Kledaras expounds on the future of the FIX protocol spreading to global equities, futures and options and fixed income instruments, how the protocol can help the Street tackle straight through processing and the significance of FIXML. For more on RX as it pertains to exchanges, retail brokerage firms and ECNs, go to www. wstonline. com to read the full transcript.
WALL STREET & TECHNOLOGY: What is your assessment of the current status of FIX in brokerage and investment firms? How pervasive is it, and how much is it being used? What would you estimate its market penetration to be?
GEORGE KLEDARAS: Currently, most people using FIX fall into [the category of] portfolio managers and it's typically the larger ones, even if they are going in through a vendor. It's starting to be adopted by smaller pension funds and hedge funds. Some of them are using a vendor, and some of them are going alone. We've seen a lot of pickup in business over the last six months in that those that go on their own develop their own FIX engine or go directly to us. The sell side has been very much involved for the obvious reason they want to attract as much order flow as they can. And if the buy side tells [them] we're sending you FIX, then they better be ready to take in FIX. They are definitely going that way. What we've seen over the last few months,...