In-Depth

Java does the Wall Street shuffle

• By Jack Vaughan
• July 6, 2001

Long ago, on a satellite faraway (the Moon), the U.S. space program planted a flag. That effort was a test bed for much useful technology. With that initial Herculean Space program now a memory, it is Wall Street, with its near-realtime, very-large-scale distributed trading systems, that may be taking over as the premier testing ground for new software technologies. This is especially true of Java.

Near-realtime, very-large-scale distributed trading systems, that may be taking over as the premier testing ground for new software technologies. This is especially true of Java.

The path Wall Street technology may take is not dissimilar to the path NASA has lately taken with its little Mars Rover, the (mostly) standard-parts vehicle that briefly rekindled public enthusiasm for space. Why? It seems sometimes there are too many applications and not enough programmers. This is especially true in the object-oriented realm. Some observers note that even the richest financial concerns -- the ones paying the biggest bucks -- will not be able to keep pace forever. Thus, they will explore off-the-shelf technology's merit. For some this means Java, Java classes and JavaBeans components. However, the road will be rocky, and there will still be plenty of outposts of customization at the end.

Java will increasingly thrive in realtime financial systems, if only because they increasingly use object technology. Java will find a home in this world, at least on the client side, if only because clients that are upgraded at runtime make sense. Java will make it on Wall Street if only because Web-based financial transactions are so quickly becoming so pervasive.

Issues that will slow Java in finance generally fall into the bin of immaturity. This shows up in instability, unacceptable performance, inadequate (or too complex) security and lack of a strong knowledge base in the programmer community. Here, although Java's promise of portability in turn promises programmer productivity increases, 100% Java purity is not usually the pressing issue.

Last fall we had a chance to talk with Dr. Thomas Keffer, president and chief executive officer at Rogue Wave Software. Keffer saw the C++ birthing first hand, and he had some reservations about how quickly Java would happen, especially in realtime financial systems. "In a way, when Turbo C++ took off, we had the same Big Bang event as with Java. Suddenly, there were a lot of books, a lot of trade shows. There were zillions of companies and they went through a consolidation."

"To get to that point with C++ took five years. With Java, it has taken just two years. But it is still going to take a couple of years for the time-critical [performance-related] stuff. What's needed is one, to make it faster; two, to create tools; and, three, to develop the [programming] talent. This all needs time to develop," said Keffer.

What do other people say? Vincent Coetzee, systems architect, Rand Merchant Bank, Johannesburg, South Africa, is using Java for Web-based financial service decision support in the areas of equity trading and derivatives management. "We believe in time to come Java will become appropriate for the server," he said. At the moment, however, stability is an issue, said Coetzee. His group comes to Java from an extensive background in object-oriented -- particularly Smalltalk -- systems. Rand, noted Coetzee, intends, as easier-to-use JavaBean components become available, to provide Sun Java Studio software to traders so they can build financial applications. This could reflect the growing concern about I/S' ability to find the resources to support the growing number of global trading applications.

"C++ today is what we use on the server," said Tony Sleep, treasury manager, Banco Espirito Santo, London, U.K. Sleep has used Passport Corp.'s IntRprise application environment to connect Reuters financial feeds with its in-house Escudo price calculator. The Escudo is the Portuguese currency. Like others, Sleep sees browser compatibility issues with use of Java today. "Is it a logical next step?" he was asked. Yes, he answered. "But we see C++ working with Java classes as complementary," he noted. The two will work together in many trading apps.

Directly or indirectly, the space program was responsible for many new technologies. Today it can be said that Wall Street has taken a greater role as a test bed for new technologies. Note that while Java-originator Sun Microsystems touts the Mars Rover's use of Java for its 1997 mission, the Java-enabled system was used only for public viewing of Rover data and for simulating missions. In 2001, Java will be onboard. Java on Wall Street, too, will take that kind of time to fully evolve.