Using cable fiber, hollow fiber, and microwave technologies
Another key (but extremely expensive) area of competition in HFT is that of setting up connectivity between data centers sitting in different geographical locations – for example, Chicago, New York, London, Frankfurt, and so on. Let's take a look at the options that enable this connectivity:
- Cable fibers are a standard option – they have high bandwidth and extremely low packet losses, and they are slower and more expensive than some of the other options.
- Hollow fiber is a modern technology that is an improvement on solid cable fibers and provides lower latency for signal/data propagation between data centers.
- Microwave is another option, but it is often used for very specific purposes. It has extremely low bandwidth and suffers from packet losses in certain weather conditions and because of interference from other microwave transmissions. However, microwaves are the fastest way to transfer...