FIX Protocol - Financial Information Exchange
FIX (Financial Information Exchange) API (Application Programming Interface) is a system of electronic communication for exchanging the real-time financial information in respect of the financial market and securities trade. The FIX –API has become the standard method of trading communication in the financial market.
FIX protocol is a messaging standard for sharing and exchanging the financial information among the market participants that includes banks, investment funds, exchanges, brokers, investors and other financial institutions. FIX is most extensively used the protocol in the finance industry to communicate with each other in these days.
FIX protocol and its efficiency
FIX is an open protocol. FIX electronically make more simple and increase the proficiency of communication among the users of the market and easy to get on board with the availability of supporting software packages. FIX is a simple and an independent protocol platform.
Future and options markets are also using the FIX – API protocol. FIX protocol has gained the popularity because of its global exposure and standard benchmarking. FIX can be used for any asset class e.g. Equities, Fixed Income, Foreign Exchange, Commodities, CFD’s and other ancillary trading instruments.
How FIX API protocol works
FIX API has primarily two massage categories including Admin and application messages. Admin Messages are used to sustain or support different facets of FIX protocol spell or sessions while the application messages are used for communicating the business or trading messages to the users of the information.
The Financial market participants on the basis of FIX usage can be divided broadly into three categories namely Exchanges & OTC, Buying Institutions and Sellers. Exchanges utilize FIX to receive trading messages from its members and remit execution trading messages. Buying and selling institutions use FIX for pre-trade, trade and post-trade messages to each other and though this FIX communicates with Exchanges and Over the Counter Markets.
FIX protocol for retail traders
FIX API protocol enables the traders to set up the privately-owned trading system. FIX API protocol receives the information from a number of different market sources and makes the trading decisions after analyzing the available data. FIX API requires the only fraction of a second to receive real-time data feeds, submit orders, cancel, set and modify the order. FIX API with its vast links helps in exploring the new investment opportunities in financial markets.
FIX API protocol has improved the business efficiency by minimizing the redundancy in communication. FIX API has improved trading operations by reducing the time spent on voice-based messaging. FIX API permits the users to take complete control over the process of transmitting and receiving data without any intermediary and also enables the trader to straightforwardly hook up with the liquidity providers.
FIX API is the new way of trading that reduces trading cost and improve the efficiency in the trading processes significantly with greater transparency. FIX API developed greater connectivity among market participants and helps to build a secure automated trading system based on the real-time market information.