FIX 5.0 significantly extends the functionality provided by the FIX 4.4 specification released in April 2003. Developed through the volunteer efforts of the FPL Global Technical Committee, FIX 5.0 addresses the latest issues faced by the financial services industry including growing market data volumes, increased regulatory pressure and the spread of electronic trading within additional product areas and throughout the trade lifecycle. The additional functionality includes, but is not limited to:
Â· Enhanced support for Foreign Exchange trading
Â· Enriched Order Routing features for reserve, peg, and triggered orders
Â· Major new support for post-trade and clearing processes for allocation, trade and position reporting
Â· Market Data Optimisation extensions improving book management
Â· Support for Reg-NMS, OATS Phase 3, and MiFID regulatory initiatives
Â· Algorithmic Trading extensions to better support the exchange of information used to initiate and execute algorithmic trading strategy trades
FIX 5.0 introduces 24 separate extension packs, each contributing to the additional level of support delivered. Each extension pack is an enhancement to the existing FIX Repository defining enhancements to messages and components needed to support a specific piece of functionality or product area. Extension packs also allow early adopters of specific functionality the ability to implement in advance of being formally incorporated into the FIX Specification document.
Additionally, FIX 5.0 includes a Transport Independence Framework which separates the FIX session layer from the application layer. This framework enables different message versions to be used within the same FIX session. For example, this will enable a firm to use FIX 4.4 Allocation messages on the same FIXT.1.1 session that is carrying FIX 4.0 Order and Execution messages. Under the new framework, the session and application layer are now separately delineated. The session layer has been designated as FIXT.1.1 and the application layer as FIX.5.0 or earlier. This significantly reduces the financial investment required to support new releases while allowing FIX to be used with a wider audience of participants from the most demanding low latency users, to those requiring massive scalability.
The functionality provided by the Transport Independence Framework will give the market even greater flexibility by allowing FIX messages to be carried over other transports such as:
Web Services - for firms who do not need the low latency requirements of traditional FIX versions, but want low-cost, high-scalability deployment
FIX Session (FIXT.1.1) - the primary transport for FIX messages for well over a decade facilitates compatibility with the existing tag = value syntax and allows incremental deployment of functionality in later releases
FIX Adapted for STreamingSM Session Control Protocol (FAST SCP) - for users with the most demanding latency requirements
Enterprise Middleware â for firms using open source and commercial middleware solutions
Commenting on the launch of FIX 5.0 Kevin Houstoun of HSBC and Co-Chair of the FPL Global Technical Committee stated, âThe additional functionality that will be delivered within FIX 5.0 presents yet another clear example of the FPL community responding to the needs of the market in a practical and value added manner. These extensions will provide significant value to all segments of the industry through support for MiFID, Reg NMS, and other impending initiatives.â
Matt Simpson of the Chicago Mercantile Exchange and Co-Chair of the FPL Global Technical Committee added, âFIX 5.0 will provide a breakthrough in flexibility by creating a platform for transport independence and application versioning. Users will be able to transition between application versions in a single session and adapt to new extensions in a more seamless manner. This is the first time FIX will present itself as a set of standalone business processes.â