e-Forex-Nov-23

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Next generation FX analytics: Bringing transparency and more to the FX execution process TRADING OPERATIONS “The historical approach of simply adding LPs via an EMS is no longer adequate because each LP and their effect on the pool needs to be understood.” benchmark from outside the system. It is from this information that the trader can create an execution methodology for each trade.” FairXchange’s Hopkins acknowledges the importance of independent data sources but stresses that analysis is just as critical. “It is important to differentiate between independent analysis and independent data,” he says. “Independent data analytics firms like FairXchange provide objective, neutral analysis of trading firms’ data. This gives firms valuable insights into their trading business that they might otherwise miss, and it also removes the perception of “marking your homework”. Indeed certain types of analysis only make sense when based on a particular firm’s data – their unique liquidity, for example,” he states. Paul Lambert When does incorporating a benchmark or ruler (as Lambert explained) hold water? “There are times when it is helpful to combine this with independent data sources,” Hopkins responds. “Particularly when the analysis is intended for third parties, such as clients, counterparties, or regulators. This gives a useful degree of standardisation, and can remove the potential for a given firm’s trading activity to leave a signature on the reference data against which trades are measured. It is also helpful for creating a level playing field, using objective data that counterparties can agree on.” COMBINING DATA WITH ANALYTICS TOOLS FOR MORE TRANSPARENCY “Data alone is quite useless without analytics,” Bloomberg’s Shevelenko says, “as analytics are a vehicle that make sense of your data and uncover meaningful conclusions. Therefore, data and analytics go hand in hand helping to constantly reshape the execution process, making it clearer and more transparent.” Hopkins believes data standardisation is a critical first step firms must invest time into. “Standardise the data into a format that permits firms to compare across different venues, trading platforms, and counterparties,” he says. “The analytics then need to be powerful enough to allow firms to quickly identify areas of interest, in real time if possible. This now extends to using AI to detect anomalies or issues that require attention.” He also points out that these analytics must be accessible to as broad a constituency of users as possible. “Data and data analysis are now part of everyone’s daily working life, it is no longer the province of a small number of highly qualified specialists,” he notes. Lambert counters that firms must look earlier in the cycle and focus on sourcing enough data. “Almost no buyside users can consume and analyse their available liquidity,” he says. “They are shooting in the dark without the data to understand their feeds and act accordingly. Most analysis available today is based on ‘dead’ data, which offers little in terms of live execution problems.” He explains that using such data with algos doesn’t make sense. “The use of a historic database of algo executions to guess which algo to use now is like driving from A to B using last week’s traffic conditions when roadworks may have moved, and the weather may have changed. This challenge is what led New Change to build its Data Processing as a Service (DPaaS) offering. NCFX, under an ordinary platform agreement, can take feeds from banks and process them to produce live analytics for its clients. Clients can create their live midrate, see how a trade or algo execution with a bank affects the prices at every other institution, and triangulate their midrate with the independent midrate from NCFX and their own micro-price.” Lambert adds that while these feeds are built on live data, clients can store James Knoop “Being able to highlight areas where LPs are struggling against their peers or being deliberately toxic with their flow can lead to a closer collaboration between Bank and LP.” 24 NOVEMBER 20<strong>23</strong> e-FOREX
Forward FX interpolation… …still trying to connect the dots? Get straight to the point NCFX Forwards365 Live, streaming FX forward rates calculated for all trading days including broken dates. No linear interpolation Benchmark Data Real-time Analytics Get in touch if you are interested in benchmark quality data capturing the granular details NOVEMBER 20<strong>23</strong> e-FOREX 25 newchangefx.com info@newchangefx.com
Page 1 and 2: transforming global foreign exchang
Page 3 and 4: Welcome to e-FOREX transforming glo
Page 5 and 6: Turning Payment Flows into Revenue
Page 7 and 8: Institutional EMBARK POWERFUL LIQUI
Page 9 and 10: NOVEMBER 2023 e-FOREX 9
Page 11 and 12: Evolving with the Market Added Func
Page 13 and 14: Accelerate time-to-trade with LPs &
Page 15 and 16: RECENT EVENT give a few more takeaw
Page 17 and 18: to building trusted partnerships Fl
Page 21 and 22: TRADING OPERATIONS market risk back
Page 23: Welcome to the next generation of b
Page 31 and 32: TRADING OPERATIONS robust, standard
Page 33 and 34: REGIONAL E-FX PERSPECTIVE The MENA
Page 35 and 36: SAVE 10% FREE FOR BUY SIDE SAVE 10%
Page 37 and 38: EMERGING MARKET PAYMENTS, OPTIMISED
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Page 41 and 42: THE e-FOREX INTERVIEW Eric, you hav
Page 43 and 44: THE e-FOREX INTERVIEW Fred Allatt (
Page 45 and 46: THE e-FOREX INTERVIEW OUR SINGAPORE
Page 47 and 48: THE e-FOREX INTERVIEW (From left to
Page 49 and 50: FX ON EXCHANGES There are two clear
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