Science News
from research organizations

Understanding the impact of delays in high-speed networks

Date:
February 23, 2017
Source:
American Association for the Advancement of Science
Summary:
In a world increasingly reliant on high-speed networks, introducing microsecond delays into such systems can have profound effects.
Share:
FULL STORY

In a world increasingly reliant on high-speed networks, introducing microsecond delays into such systems can have profound effects.

In this Policy Forum, Neil F. Johnson discusses the need to better understand how these micro-delays may drive more extreme behaviors, particularly in the context of the financial market, but also in other fields. In fall 2016, the U.S's fastest and largest financial network was subjected to its first ever intentional delay. The seemingly minute delay of 350 microseconds was significant enough to give traders the false impression of an increase in market activity, which can trigger trading algorithms and create a feedback effect on the price dynamics.

Johnson says that policy-makers justify this delay because it levels out highly asymmetric advantages available to faster participants. The impact of these delays needs to be better understood, however, before their broader use, he says.

For example, data-capturing a 500 microsecond delay and bunched delays resulted in substantially more extreme trading behavior. The need for a better understanding of the impact of delays is increasingly urgent, as similar techniques are poised to be extended beyond the financial market, for example to navigational networks in driverless cars or drones.

The core scientific challenge, Johnson says, is to be able to predict the types of extreme behaviors that an intentional time delay will generate. Classifying a system's sensitivity to such delays could help policy-makers tailor policies to cope with different market scenarios, Johnson concludes.


Story Source:

Materials provided by American Association for the Advancement of Science. Note: Content may be edited for style and length.


Journal Reference:

  1. Neil F. Johnson. To slow or not? Challenges in subsecond networks. Science, 2017 DOI: 10.1126/science.aai8618

Cite This Page:

American Association for the Advancement of Science. "Understanding the impact of delays in high-speed networks." ScienceDaily. ScienceDaily, 23 February 2017. <www.sciencedaily.com/releases/2017/02/170223142129.htm>.
American Association for the Advancement of Science. (2017, February 23). Understanding the impact of delays in high-speed networks. ScienceDaily. Retrieved May 27, 2017 from www.sciencedaily.com/releases/2017/02/170223142129.htm
American Association for the Advancement of Science. "Understanding the impact of delays in high-speed networks." ScienceDaily. www.sciencedaily.com/releases/2017/02/170223142129.htm (accessed May 27, 2017).

RELATED STORIES