The Monetary Authority of Singapore has issued a consultation paper as part of its plans to formalise expectations for holders of a capital markets services licence, banks, merchant banks and finance companies to have in place policies and procedures to place to ensure best execution and to support fair outcomes for customers.
The consultation is in tandem with MAS’ earlier proposal for a market operator to have in place measures to facilitate its members’ execution of customers’ orders in the customers’ interests, and to ensure that its handling and execution of bids and offers is conducted on a fair and objective basis.
Last month I wrote about the challenges of regulating machine learning, but will AI highlight the different market structure between equities and FX – something that is a long running theme of this column? The value of AI is unarguable, but it strikes me that it will be put to different uses in FX than, for example, equities - and that is because of the different market structures of each instrument. One use is revolutionary, the other? Well we're kind of used to it...
The wealth of data and predominance of electronic trading mean TCA in spot FX should be a relatively straightforward process. But what happens when a market is mainly voice traded and data is sporadic? Colin Lambert finds out.
Among the many upheavals created by the impending MiFID II regulation is the requirement to timestamp all trades in compass of the regulation. In FX markets this has created a paradox, for while it is easy to timestamp a spot FX trade, this product is not “in scope”.
FX forwards and swaps, on the other hand, are in scope and they are mainly traded over voice channels and no public central limit order book (CLOB) has enough volume or data to provide a “market” price.