For trading systems that are still software based they absolutely do not allocate or reclaim on the hot path for this reason.

"That are still software based" is interesting. Are there hardware-based trading systems?

Yes. The fastest systems are asic or fpga based. They typically never leave the router.

I guess my presumption was that algorithmic trading was a very tight feedback loop, with as many controlled variables (i.e., GC) as possible, so I think it just subverted some of my misplaced expectations.