“You’ve got the prime-of-primes like INTL FCStone that partner up with a few FX prime brokers and then offer aggregated liquidity, access to multiple ECNs and dark pools for customers to trade on, It’s a way for these customers to have access to additional credit or to access the institutional market because they couldn’t qualify for an FXPB. Alternatively, there are firms that offer the same types of services but they offer it through direct bilateral lines, setting up multiple ISDA agreements and then settle directly with their respective counterparty(s).”  – Fred Allatt, head of institutional sales, Americas, INTL FCStone

“To be a true prime-of-prime you want to offer a service that is as close as possible to the traditional bank FXPB service in terms of direct market access. You also have to fulfill certain criteria from a counterparty point of view: you need to have capital, you need to have plenty of credit, and you have to be able to offer direct market access pricing.” – Peter Plester, head of FXPB sales, Saxo Markets

“We provide access to tier one bank and non-bank liquidity via our direct bank and prime broker relationships. Clients can access our liquidity either on a cash funded margin basis or via their own bank/PB credit arrangement. Some firms operate an agency model, whereby liquidity and clearing is carried out solely on a credit agreement.”  – Paul Jackson, global head of sales, CFH Clearing

“A real prime-of-prime offers a pure clearing solution with direct market access. If you sign up as a PoP client with FXCM we act as a clearer only – clients sign an FX prime brokerage contract with us, and then you sign a user agreement with each of the ECNs that they want to trade on. This means that our clients can plug directly into the ECN’s API and you have all of their discussions about liquidity, fill ratios and spreads with the liquidity managers at each ECN, FXCM is not involved in the pricing or the trade flow in any way.” – Justin Boulton, head of FX prime brokerage, FXCM

“For me, a prime-of-prime should be there to give customers access to the FX market with the minimum number of links possible. That is generally predicated by having a PB or direct access to disclosed liquidity as the starting point. The other part of it is that a PB is just a clearer, it doesn’t have any influence as to where the liquidity is executed against. Similarly, as a prime-of-prime, we are a matched principal, meaning that we pass on the access that we have to our clients, we’re not running a book and are agnostic about where they execute their trades.” – Ramy Soliman, CEO, Stater Global Markets

 

“Prime of prime services can range from simple liquidity aggregation and distribution when the provider stands as the credit intermediary, all the way up to where we sit offering services such as ECN direct market access. What differentiates Sucden Financial from other Prime of Primes is that we also offer voice execution, OTC FX Options and deliverable FX as part of our core offering. Our aim is to offer a viable alternative to tier 1 PBs in the services we offer. Whilst we offer the security of a significant balance sheet the only service we cannot offer yet is access to disclosed liquidity providers.” – Noel Singh, head of e-FX business development, Sucden Financial

“A true prime-of-prime”, is simply an STP intermediary with excellent tier one prime broker relationships, one that has the ability to leverage, or extend, those credit relationships to the benefit of its clients. These services are particularly suited to retail FX brokers, asset managers and other firms that can’t access prime credit directly. The goals of a true prime-of-prime are fully aligned with those of its client base; there is no dealing desk, no warehousing of risk and no conflict of interest.”  – Natallia Hunik, global head of sales, Advanced Markets

 

Galen Stops

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