Signal Transmission Speed

Signal transmission speed is the physical velocity at which data signals travel through a medium, such as fiber optic cable or copper wire. This speed is constrained by the laws of physics, specifically the speed of light in the transmission medium.

While this speed is extremely high, it is not infinite, and over long distances, it contributes to unavoidable latency. In financial markets, this constraint drives the demand for shorter network paths and faster transmission technologies.

Traders and exchanges constantly look for ways to optimize signal routing to shave microseconds off their total round-trip time. This physical limit is the ultimate barrier for all electronic trading systems, setting the floor for how fast orders can be processed.