The computer system at the Budapest Stock Exchange has now been up and running for about two weeks, and according to chief system analyst Andrei Bagi, there has been only one minor teething problem. This occurred when a broker attempted to undertake a single transaction involving 2,000m Hungarian Forints – $22m – in the government […]
The computer system at the Budapest Stock Exchange has now been up and running for about two weeks, and according to chief system analyst Andrei Bagi, there has been only one minor teething problem. This occurred when a broker attempted to undertake a single transaction involving 2,000m Hungarian Forints – $22m – in the government bonds market only to discover that the appropriate field in the application didn’t have enough space for the zeros. The Budapest Stock Exchange spent $2.25m on the system for which Digital Equipment Corp supplied a system based around three VAX 4000/200s, along with 23Gb of distributed storage, terminals and printers. DEC also subcontracted the London-based software house Transvik Ltd which had previously developed the software for the Nordex exchange in the City of London; it was its foundation on the pound sterling that caused the failure of the bond transaction, but contrary to local press reports, the system did not crash and an update to overcome the problem should be in place in a few weeks time. Touche Ross and GMA secured the consultancy contracts and their $1.2m fees were paid from the British Know-How fund. Finance for the computer system itself came from the European Community PHARE programme. According to Bagi, DEC secured the stock exchange contract due to its good references in Hungary, its ability to replace any component in eight hours, and the size of its local presence. Logica Plc, which offered its Oslo system as a model was also a strong candidate, but the firm lost out as it was reportedly unable to tender a window-based system. Bagi concedes opting for Transvik software was a risk, given the company’s small size, but argues the advantage is that the firm is dependent on the success of the contract and is more willing to share its expertise than Logica might have been. At present the system is specified to support 128 users, of which 63 are now connected, and to handle 1,000 trading instruments while storing 10,000 lodged orders. The three VAX servers are said to be able to cope with 1,000 transactions an hour, though so far they have been tested to only a few percent of their capacity. Indeed, given the fact that there are only a couple of dozen companies quoted on the exchange, the opportunity for follow-on business for DEC is looking limited in the short term, despite its apparent enthusiasm to off-load a VAX 6000. Transvik, on the other hand, is likely to be asked to develop software to manage the options and future exchange in the near future, pending the results of an internal feasibility study. This would replace a Novell Inc NetWare-based system which was developed in-house and which is still in operation today. Any lessons for the City of London to draw on after Taurus? Bagi notes: Our brokers have been very supportive. They helped specify the system and we had regular meetings so nothing got out of hand. It probably slowed down the whole process a bit, but it made it all much safer.