What is FIX protocol?

The Financial Information eXchange (FIX) protocol is a communication standard for financial trading applications across trading houses and market exchanges.  The FIX standard has several benefits, including real-time trade execution and vendor neutrality.  FIX applications can also scale to high volumes of trade activity while achieving less than 10-millisecond delays.  As a communication protocol, FIX is free, open, and widely used by software engineers who develop financial trading applications.  It can be thought of as a common electronic communication platform between financial services companies all over the world.

This is a FIX message

The FIX protocol standard is simple but verbose.  Each FIX message contains information on the sending and receiving computer, ticker symbol, order type, number of shares, order time, and other relevant information to the trade.  Each piece of information in a FIX message is represented as a series of tag-value pairs, as shown below.

The challenges for financial institutions when managing the performance of FIX applications include minimizing server response time, responding to FIX protocol errors, and ensuring that trades are going through as requested.  FIX applications must interpret very rapidly high and variable volumes of FIX messages, receive and process market data updates, and summarize thousands of these messages every minute, turning them into actionable information.  IT organizations that manage trading networks and FIX applications need summarized performance reports, latency details, actionable alerts, and retrospective analysis capabilities to properly manage financial trading applications.