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THE e-FOREX INTERVIEW<br />
Fred Allatt (right) leads sales for the Americas and is based in New York<br />
How important is state-of-theart<br />
technology in helping you to<br />
deliver and maintain the platforms<br />
and execution services you offer<br />
and what direct benefits are<br />
your clients getting from the<br />
investments you make in it and<br />
access you give them to it?<br />
During the venture capital boom of<br />
the 2010’s there were a lot of large<br />
investments in FX technology. There<br />
were so many firms trying to earn a<br />
small piece of every transaction they<br />
could touch, and many of them were<br />
actually very innovative. However,<br />
eventually you end up with a market<br />
that’s flooded with tech vendors, and<br />
way too many hands in the cookie<br />
jar on each transaction and the<br />
consumer wasn’t seeing any reduction<br />
in costs. I think this peaked around<br />
2018, and for our business we had to<br />
become laser focused on delivering<br />
the best trading environment<br />
without any marginal costs attached.<br />
Every investment we make in<br />
technology tends to be focused on<br />
price compression, allowing us to<br />
continually win on tighter pricing,<br />
while growing our own profitability on<br />
scale and increased volume<br />
Earlier this year e-<strong>Forex</strong> reported<br />
on how demand for your FX<br />
trading services has been growing<br />
significantly recently. What factors<br />
have been influencing that?<br />
Obviously, market volatility is a big<br />
factor, driven by both higher interest<br />
rates and geopolitical instability. We<br />
trade longer tenor forwards, options,<br />
as well as interest rate swaps, so I<br />
think we are even more impacted by<br />
the rate environment than your typical<br />
spot FX liquidity provider. At the same<br />
time, we’ve seen some very high-profile<br />
banks pull out of the FXPB space<br />
entirely, while others are pulling back<br />
due to a combination of regulations,<br />
capital usage, risk, and opportunity<br />
cost. This has certainly opened the door<br />
for us to increase our market share.<br />
In what ways has the FX market<br />
been evolving to create new<br />
opportunities for firms like StoneX<br />
Pro to come along and disrupt<br />
the status quo by offering more<br />
efficient access to institutional FX<br />
markets?<br />
The number one pain point we’ve<br />
tried to address in the institutional<br />
FX space has been the complexity<br />
StoneX Group by the numbers<br />
NOVEMBER 20<strong>23</strong> e-FOREX 43
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