1. THANK YOU FOR JOINING OUR WEBINAR
A NEW AGE FOR STORAGE:
OPPORTUNITIES FOR TRADING
TUESDAY, DECEMBER 4, 2012
1PM EST
PRESENTED BY DELL AND KOVE
TABB Group

2. Agenda
• Quick Overview of Trends with Adam Sussman
• Intro to Kove
• Conversation with John Overton of Kove and
Mark King of Dell
• Q&A
2

3. Featured Speakers
Mark King John Overton Adam Sussman
Global Strategy Director,
CEO and Founder Partner, Head of Research
Banking and Securities
Kove TABB Group
Dell Inc
John founded Kove in Adam oversees TABB Group’s
Mark’s role is to develop next
2004. Before that, John was global research business, spanning
generation solutions in the
founder and CTO of a company equities, fixed income and listed
Banking & Securities vertical as
that built the fastest network- derivatives, and the supporting
well as manage Dell’s strategic
optimized database in the world. technology infrastructure.
partners in this space
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4. Data management is the most initiative with the greatest
intensity and continues to trends
Top Business Drivers of Capital Markets Technology
High
Data
Management
I
n
t Lower
Risk TCO
e
n
s Regs
i
Latency
t
y
Security
Disaster
Recovery
Mobility
Low Trending High
Source: TABB Group 4

5. Message rates have uncoupled from volumes
Aggregated One Minute Peak MPS Rates
Arca, CTS, CQS, OPRA, NQDS
6,617
(in thousands) 5,500
5,210
4,092
3,410
1,562 2,562
907 1,925
701
573
180
120 150
5 7 10 13 26 80
Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11
US equity ADV (in Bs shares)
9,747 9,382 6,831
8,146 8,682 7,464 6,783 7,274 6,371
5,760 5,038 6,134 5,896
4,133 4,205 4,360
2,821 3,115 3,219 3,110
0
Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11
Source: SIAC, OPRA, NASDAQ, FTF, TABB Group Est 5

6. Increasingly trading world is one of massive
data and analytics
HFT Estimates % Share Volume (US Equities)
52% 61% 56% 55% 51%
35%
14.0%
27.0% 32.0% 31.0% 31.5% 31.0%
16.0%
17.0% 12.5%
21.0% 18.0% 14.5%
22.0%
5.5% 6.5%
5.0% 14.0% 7.0%
5.0% 9.0% 7.5%
8.0% 7.0%
15.0% 7.0%
14.0% 15.5%
12.0% 11.0% 13.0%
1 12.5%
20.0% 13.0% 12.0% 12.0%
6 13.0%
% 10.0% 10.0% 11.0% 13.0% 13.5% 14.5%
2007 2008 2009 2010 2011 2012 HFT Total
Retail Long Only Hedge Fund HFT Hedge Bank Flow/Specialists Ind Prop Market Makers
FX Turnover by Entity
(Avg Daily Turnover in $USb)
13%
$4,500
$4,000
$3,500 13%
$3,000 18%
$2,500
48%
$2,000
14% 40%
$1,500 17%
19% 17% 33%
$1,000 20%
18% 28%
20%
$500 13%
$- 70% 64% 63% 58% 53% 42% 39%
1992 1995 1998 2001 2004 2007 2010
Reporting Dealers Other Financial Inst Non-Financial Customers 6
6

7. High frequency latency curve makes investments
in lower latency infrastructures challenging
+++ Initially, to reduce the level Latency (L) by X
amount, you require y resources
Lx
x
L
A However, as you advance along the Latency
T Maturity Curve, to achieve the same level of latency
improvement, it requires 4x as many resources (y)
E xl
l
N
C
++
Y La
ten
y c
L C u y Ma
V rve tu
rity
L
s 4y
+
$ $$ $$$
RESOURCES
Source: TABB Group 7

8. In Front Office, feature rankings are clear…
Front office data challenges
 Data management is the leading
Enhanced Data pain point for quants
3.7
Management  Enhanced data management
means not having to move the
data around as much
Greater
 Computational speed is just as
Computational 3.5 much a function of how fast data
Speed can be moved as the engine itself
 While most firms need better
collaboration, this does not
Enhanced necessarily translate into a need
Collaboration 3.1 for - or an awareness of - better
Tools
collaboration tools (3.1 out of 5)
Spreadsheet-
Like Modeling 2.7
Platform
Source: TABB Group 8

9. Conclusions
 Data will only become more important
 Latencies will only decrease as competition drives
demand to be first
 For others, increasingly it will be about analytics as
deeper analytics provides differentiated alpha
 A renewed interest in stability will lead to greater focus on
system integrity
 Regulation is driving risk and compliance
 Demand will remain high for at least five years
 Required
 Handle data faster
 Calculate impact on pre-trade basis
 Test against even more data under more scenarios
 Recovery time will need to be faster
9

10. i/o landscape
disk flash xpd™ (dram)
• Read 6 ms • Read Claim 68 µs • Read 5 µs
– Base – Ratio 88:1 – Ratio 1200:1
• Walking • Bullet Train • X15 Rocket Plane
• ~ 3 mph • ~ 264 mph • > 3,600 mph
Source: https://www.fusionio.com/platforms/iodrive2/ 1.2 TB MLC
10

11. as NAND density increases…
… lifespan shortens & errors increase 3x
* 6 vendor products tested
Source: “The Bleak Future of NAND Flash Memory”, Dept. of Computer Science and Engineering, U. California San Diego and Microsoft Research, Mountain View,
11

12. but DRAM just gets better…
… as density increases 90%
…... and power decreases 70%
……… bandwidth increases 1,500%
Source: “http://www-03.ibm.com/press/us/en/pressrelease/36125.wss”, IBM (Armonk NY) and Micron (Boise, ID) 12

13. STAC-M3 Dell-Kove v. 2nd Best
Dell-Kove beats
% as fast
competition in 94% of
all tests
13

14. Moore’s law benefits DRAM and CPUs
• 512 Core NVIDIA “Fermi”
14

15. tomorrow or today?
fastest available storage
 iops (world record)
 latency (world record)
 bandwidth (world record)
 instant copy (world record)
 STAC-M3 tests (world record)
i/o that doesn’t wear down or wear out
… easy adoption path
debate the possible, or act & win now?
15

16. How do you guarantee that you can get the quote that is
driving your trade decision?
Low latency Data Instantaneous
Risk analysis
trading back-testing cloning / restore
Securities firms and hedge funds are looking for the fastest possible
trade execution.
Solution • Dell and Kove ran the STAC-M3
benchmarks and delivered the
The high performance best performance ever in 94% of
database solution provides the all tests.
lowest latency, highest
performance tick capture and • For instance, one improvement is
market data analysis in the >33x the speed of the previous
world best Theoretical P & L benchmark
16

17. The first step is to minimize latency in your existing
infrastructure.
Typical Mixed Feed Data Consumption with Deployment Framework and Multiple Internal Components
Aggregated Market Execution Venues
Data Feeds Direct Market Data Feeds
Market Data Servers Routing & Execution Servers
Feed Ticker
Feed Handlers Data Cache
Handlers Plant
Time Series Analysis Complex Event Stream
Framework Processing Framework Data
Prediction Strategy Cache
Engine(s) Engine(s)
Historical Application Servers
And Risk Compliance EMS / OMS / / OMS /
EMS
Data Cache
Data Cache
Reference Analytics Systems PMS PMS
Data
High Speed Physical
Low-Latency Messaging Bus
Network Connectivity
Distribution Platform
External Systems
Servers and/or Server Grid
Real Time Data
Logical Component
Processing Systems
Distributed Data Cache Historical Data Store 17
Source: TABB Group

18. How do I lower my time-to-market for new strategies while making sure the
testing is robust?
Low latency Data Instantaneous
Risk analysis
trading back-testing cloning / restore
Financial firms need real time access to historical data (i.e. 5 to 10 yrs on
average) while running Quant analytics much faster to remain
competitive
Solution
• An investment firm that takes
Utilizing the high performance hours per Quant can reduce
database solution, financial this interval to minutes while
trading firms can execute also analyzing additional data
back-testing of data in a reference points.
fraction of the time it took in
the past • Payback potentially in less than
a few months.
18

19. Unified infrastructure helps vastly improve inter- and
intra-enterprise communications and product innovation
Primary Data Channels Market Fundamental News / Commentary Pricing / Reference
VWAP / TWAP Yield Ratios Sentiment Indicators Complex Evaluation
Derived Data Examples
Volatility / Greeks Analyst Indicators Keyword Indicators Entity Relations
Price Earnings Newswires Terms / Conditions
Raw Data Examples Volume Balance Sheet Press Releases Corporate Actions
Trades / Quotes Economic Web Content Entity Data
FRONT OFFICE BACK OFFICE

20. The efficient use of limited risk funds is going to separate the
winners from the losers in the new era
Low latency Data Instantaneous
Risk analysis
trading back-testing cloning / restore
Securities firms and hedge funds are looking to make better informed
trades that will greatly reduce credit, market and operational risk
Solution
• Dell and Kove ran the STAC-M3 and
The high performance delivered the best performance ever
database solution allows in 16 of 17 tests
financial firms to run
risk/compliance calculations • The market snapshot test was run in
against a common pool with no just 184 milliseconds while taking
performance penalty to other over 3.8 seconds for the nearest
users competitor (nearly 21x improvement)
20

21. The requirements for calculating risk are becoming more complex at the
same time as the update frequency is increasing
Every order must pass pre-trade risk Credit and capital thresholds
checks monitored
Order Size
Notional Value
Credit Limit
Committed Cap
Client Orders Restricted Stock Executing
Venues
Executing
Venues
Executing
Pass Venues
Orders entered using Executing
Prop Desk Broker’s MPID Exchanges
Venues
Orders Reject &
ATSs
Sponsored
Access Orders
Immediate execution
reports to
to surveillance personnel
21
Source: TABB Group

22. Operational intelligence will be a trading tech buzzwords in a post-Knight
trading environments
Low latency Data Instantaneous
Risk analysis
trading back-testing cloning / restore
Financial firms need real time access capture of data that can be
instantaneously backed up and restored,
Solution
• Dell, Kove & ParAccel recently
Utilizing the high performance tested instantaneous back up and
database solution, financial restore of fully cloned data
trading firms can greatly • Results included a 6.7 PB/sec
improve trade execution while snapshot, cloning the database in
assessing counter party risk, microseconds with complete
fraud and trading in real time. database spin up in <30 seconds
22

23. Proof of Concepts
 remote
 no equipment required
test in remote lab via ssh login
 on-site try-and-buy
 use your own equipment
xpd™ shipped to you
test in your own environment
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24. Q&A
Please submit your questions via the GoToMeeting interface
If your question is not answered, please send to xxx and we will follow up.
For more information: please contact Mark King at: Mark_King@Dell.com
Work phone: 203-840-1631 Mobile: 203-722-7919
John Overton
Kove
Mark King
Dell
Adam Sussman
TABB Group
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