Cooperative Brokerage Integration for Transaction Capacity Sharing: A Case Study in Hong Kong

Abstract

Although today’s brokerage trading platforms designed by software vendors fulfill the basic functionalities, the brokerage industry still has difficulties to face emerging problems such as the gradual increase of trading volume that cannot be handled because of the limitation of the current system architecture and throughput. Based on our consultation experience, we explain some of such constraints in Hong Kong from the business viewpoint of medium size brokerages. We introduce how a cooperative Transaction Capacity Sharing System (TCSS) among brokerages could help improve the situation by sharing their transaction capacity. In such business-to-business (B2B) system integration, we adopt asynchronous Web services and explain how they can work together to overcome these constraints in a real-time brokerage trading environment. We also detail the TCSS architecture and protocols for the integration which orchestrates the new cooperative trading process in our Web service based solution.