Month: June 2017

RIP Alan Attwood

Alan Attwood, former ACI UK president and long-standing supporter of ACI – the Financial Markets Association, has died after a long illness.
Attwood was a well known figure in the UK and wider FX community. His career began in the back office of British Bank of the Middle East, from where he moved to the dealing floor. BBME was later amalgamated with HSBC, and after 14 years he moved to Credit du Nord in London as chief dealer. He then joined Raiffeisen Zentralbank and in 1990 moved to Chartered West LB.

Vela to Acquire OptionsCity

Trading and market data technology provider Vela Trading Technologies has entered into a definitive agreement to acquire OptionsCity Software, a provider of futures and options trading and analytics solutions.
Vela says the acquisition will expand its front-office capabilities to include analytics and risk management tools, enhance its market access managed services with additional trading and content solutions, and accelerate its data cloud strategy. The acquisition will also accelerate OptionsCity’s growth strategy, the firm adds, providing its clients with access to additional asset classes, trading venues, geographies, low-latency data feeds, and market access products.

How FinTech is Set to Change the FX Industry

Speaking at the Profit & Loss Forex Network New York conference, panellists outlined how they think the application of fintech solutions will shape the FX industry going forward.

Nick Solinger, president of FIA Tech, broke down three specific areas where he sees the potential for distributed ledger technology (DLT), or peer-to-peer technologies, to have a major impact on the FX industry.

Firstly, he highlighted how these technologies could change payments systems.

“The current market structure has been the primary limitation in terms of who can provide credit to whom and trade with whom and access the market on the same basis as a large, highly regulated dealer. So there is a focus on improving the payment network, and that will have potential implications upstream in terms of who can trade with whom,” said Solinger.

How Long Can the MXN Rally Last?

Galen Stops looks at the drivers behind the appreciation of the Mexican peso and asks whether the rally can continue.

Few, if any, saw this coming.

After Donald Trump won the US presidential race in November 2016, USD/MXN went from 18.03 up to 20.89, and by the time of his inauguration in January 2017, the exchange rate was up to 21.58.

This depreciation of the peso seemed eminently reasonable at the time, given that on the campaign trail Trump had promised to renegotiate the North American Free Trade Agreement (Nafta) in America’s favour or terminate the agreement altogether, not to mention building a border wall between the US and Mexico at the latter’s expense.

New Platform Promises to Solve “Major Problems” in Cryptocurrency Markets

Hong Kong-based OpenANX, a new real-world application of decentralised exchanges built on the Ethereum blockchain, says it has developed key technical aspects that will tackle two major problems in the cryptocurrency space – the barrier to entry for new cryptocurrency users, and risks associated with many transactions.
The new platform says it will allow new market entrants to easily enter the space and to understand their exposure to risk on any potential deal, a feature that’s lacking in current exchanges.

Report: Top Dealers Loosen Grip on FX Market (Slightly)

The top five FX dealers are losing market share, according to a new report from Greenwich Associates.

Although the world’s five biggest FX dealers still capture a massive 44% of global market share in aggregate, according to the research, that proportion is down from 48% last year and from 53% in 2013.

The report identifies several trends that are driving these changes. It says that while top-tier dealers have been narrowing the scope of their product, regional and client coverage, FX investors continue to increase their trading via multi-dealer platforms, which create a more level playing field for liquidity providers.

And Another Thing…

Today’s column is about technology, speed and the race to zero. It also quotes Top Gun – a first in the pages of Profit & Loss – and in reality it does actually care that much. After all, do you pick sides when the National Football League owners (the billionaires) go up against the NFL players (the multi-millionaires) over money?
Speed of technology is important to a certain extent, but there has to be a point when it becomes largely irrelevant to the most important people in the FX industry – the customers.

Jefferies Adds Three to its FX Team

Jefferies has hired Michael Porzio as SVP, head of e-FX product, Bryan Seegers as SVP, quant relationship management, and Patrick McInerney, SVP, sales trader.

All three will be based in New York and will report into Ray Kamrath, global head of FX at Jefferies.

Porzio started his career in financial services when he joined Merrill Lynch in 2005. Following the acquisition of Merrill Lynch by Bank of America, Porzio was made regional lead, VP of e-FX client services in 2010 of the newly minted Bank of America Merrill Lynch (Baml). In 2012, he was named as VP, e-FX sales, America at the bank.

Survey: Asset Managers Uncertain About Mifid II Rules

new rules, according to a survey by the Alternative Investment Management Association (AIMA).

Fund managers globally that responded to the survey said that their biggest challenge regarding Mifid II is uncertainty about what the rules contained within the regulation actually mean – both their scope and substance – as well as what they perceived to be a lack of clarity relating to the cost and nature of services provided by brokers.

The survey showed that 34% of alternative asset managers are undecided about how they will pay for research following the implementation of Mifid II. Of those that have made decisions around how to pay for research, 80% plan to charge investors and the remaining 20% intend to absorb the costs themselves.

Ktorza Ruling Overturned

A UK appeals court judge has decided that former JP Morgan FX salesperson Patrice Ktorza’s case must be reheard by an employment tribunal.
In a judgement, Judge David Richardson accepted the bank’s claim that the original judge who head the case had adopted “a legally incorrect” approach to the law and “disregarded or misunderstood” important aspects of JP Morgan’s case.
Ktorza won his claim for unfair dismissal in August 2016, however Profit & Loss noted at the time that the case was “tricky” because it involved the subject of partial fills of client orders.