There are different definitions in relation to latency:
- LMAX define "trade (order) execution latency" as the time between the receipt of an order arriving at the edge of LMAX Exchange systems, and the order confirmation leaving LMAX Exchange systems. For broker users - the trade latency figure also includes the time it takes to do all pre-trade risk checks, ensuring the trade can be executed.
- LMAX define "internal latency" as the time it takes for the order to be processed through LMAX Exchange “matching engine” software.
- LMAX define "MTF latency" as the latency seen by a General Member (liquidity provider) as opposed to a broker user. It is the time between the receipt of an order at the edge of the LMAX Exchange systems and the trade execution confirmation being received by the General Member.