LPL Financial trading journey to AWS Cloud (MAM118)

Trading Journey with AWS: Driving Business Outcomes

Overview

  • LPL Financial is the largest broker-dealer in the United States, managing over $1.5 trillion in assets across 26,000 financial advisors.
  • Their goal is to support their advisors and institutions for their success, with the primary driver for their transformations being centered around the advisor.
  • LPL's trading systems are high-throughput, processing over 1 billion events, with multiple applications and high ingress and egress of system messages.

Rationale for Adopting AWS

  • LPL's systems have grown by 25-30% in the last 3 years, and their advisor demands are increasing, requiring more availability, faster response times, and scalability.
  • Moving to AWS was the best approach to address these growing needs and deliver the required business outcomes.

LPL's Cloud Journey

  • LPL's cloud journey is a multi-year endeavor, as they needed to transition their systems that have been built over multiple decades.
  • They established a dedicated uplink between their on-premises data center and the AWS Landing Zone to ensure a secure network connection.
  • They started with small wins, incrementally adding more concepts like microservices, domain-driven design, and serverless architecture.
  • Over the last 2 years, some of their systems have scaled up to 50x, with high fault tolerance.
  • They have also transitioned their data to the cloud.

Use Cases

  1. Client Works Rebalancer System:

    • This is LPL's flagship trading system, serving over 20,000 advisors and processing 100 million+ trades.
    • The key criteria were seamless integration with their existing platform and ensuring high scalability to handle market events.
    • They moved the business logic to the cloud, integrating the on-premises API gateway with the AWS API gateway.
  2. Intraday Pipeline:

    • This is a messaging-driven architecture that handles the high throughput of hundreds of thousands of trades per minute.
    • They used a federated Kafka setup between their on-premises and cloud environments to gradually migrate and optimize the platform.
    • This system can currently scale to handle the required throughput, with the ability to dial it down to match the capabilities of their external partners.

Key Learnings

  1. Talent:

    • Building a team with the right talent and a culture of continuous learning is crucial for a successful transformation.
    • Upskilling the existing team and bringing in new hires with the required expertise are important.
  2. Customer Centricity:

    • All decisions and technology choices should be driven by the needs of the customers (in this case, the financial advisors).
    • Aligning every objective and key result (OKR) to customer outcomes or business efficiencies is essential.
  3. Incremental Delivery:

    • Adopting a big-bang approach is not feasible; instead, delivering value incrementally through milestones is crucial.
    • Early wins and learning from mistakes along the way are important.
  4. Transparency and Communication:

    • Maintaining transparency and open communication with all stakeholders, even during setbacks, helps establish trust and ensures continued support for the transformation journey.

In conclusion, LPL's trading journey with AWS demonstrates the importance of a business-driven approach, incremental delivery, and effective stakeholder management in driving successful technology transformations, especially in the highly regulated financial services industry.

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