OStatic

While there have been some questionable strategies playing out on Wall Street recently, and the Securities and Exchange Commission continues to scrutinize the legalities of a few high frequency trading techniques, former NYSE chairman William H. Donaldson's statement to New York Times holds true: if an individual investor can't keep up with larger brokerages, it's a major disadvantage.

Marketcetera feels that open source software is an ideal way for smaller brokerages to keep up with -- and perhaps outmaneuver -- their larger competition. Marketcetera CEO Graham Miller sees open source hosted/SaaS (software as a service) trading platforms as having particular potential for investors using high frequency trading methods. And Miller isn't the only one who believes this -- the evidence is vibrantly illustrated by Sky Road LLC's integration of Marketcetera's open source, automated trading platform into its SaaS financial services product line.

While news of Marketcetera's 1.5 release of its open source trading platform will certainly appeal to those working with financial-services specific software deployments, there's a neat little gem in this story that will make any open source software enthusiast smile. Marketcetera, the open source pioneer in the automated stock trading platform arena, has always had the advantage of fast deployments, infinite extensibility thanks to its built-in scripting engine and open nature, and impressive scalability -- and its 1.5 release builds on that foundation.

But claiming that a software platform is fast, scalable, and makes better use of the hardware it runs on is one thing -- proving it is another. Truth be told, different hardware configurations can yield slightly different results, and most companies don't have the time or resources to test software under controlled circumstances for any length of time.

Most companies, with the possible exception of Intel, with its labs in various locations for just this sort of purpose. Aside from the new features and enhancements Marketcetera users will experience in the 1.5 release, they can also rest assured that in testing conducted at Intel, Marketcetera performed on par with its proprietary competition. Thanks to community innovation and contribution, functionality and performance are continually increasing.

The financial services market is still a largely uncharted region for open source software. Sure, there are several Exchanges around the globe that use Linux to power their operations, but the minds, the people, and the currency that bring life to the trading floors don't operate solely on a patch of real estate in New York, London or Hong Kong. Marketcetera is one of the first open source software vendors to blaze a trail in this industry, with its open source trading platform catering to buy side and algorithmic trading.

Tackling a new market often necessitates a new way of thinking and looking at problems, but having experienced advisors onboard is still crucial to successfully navigate the unfamiliar territory -- for the insight they give, and the assurance their presence can instill in potential customers. This is only one of the reasons Marketcetera is welcoming Larry Stefonic to its advisory board. Stefonic is no stranger to the software industry, having co-founded the yaSSL project, an open source internet security suite, holding management positions at Centure Software, Raima Corporation and recently serving as the executive vice president of sales at MySQL AB.

The Marketcetera team is as aware as the rest of us that economic changes are coming fast and furious, and that open source software can have an impact on a company's -- or individual's -- financial future. Honestly, one could say Marketcetera is twice as aware of open source software's financial potential.

Today, Marketcetera released the first full production release of its open source automated trading platform. Aimed at hedge fund managers, traders, brokers and dealers, the system is standardized, open, scalable and modular. This, says Marketcetera CEO Graham Miller, offers users faster deployments, better integration, and the ability to customize everything from the public APIs to data models.

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Big hedge funds, individual traders and others are driving up the amount of money invested in high-frequency quantitative trading strategies. Does that represent an opportunity for open source trading platforms?

Some investors might cringe at the idea of trusting a lot of money--and trade executions--to open source software, but opportunities are arising. Marketcetera, a leading open source platform provider recently released a new version of its trading software, and will announce tomorrow that it has closed $4 million in Series A funding led by Shasta Ventures and Jack Selby of Clarium Capital--a hedge fund.