Standard Chartered Bank has completed a rollout of the Progress Apama FX Market Aggregation Accelerator across its foreign exchange desks in three continents. The bank is using Apama to aggregate liquidity from five ECN trading venues via a combination of FIX and venue-specific direct connectivity adaptors provided by Apama.
“The key benefit of the Apama FX aggregator is its ability to provide access to broader, deeper liquidity, which leads to improved price discovery and better fills for the traders,” says Todd McDonald, Standard Chartered’s global head of FX electronic pricing and trading.
“Plus, pulling all the rates into one place frees up screen real estate on the traders’ terminals. With the aggregated view that Apama provides, our traders have a much better picture of an FX market that has become increasingly fragmented over the last few years.Â This aggregated view enables far more effective FX pricing strategies. And the ability to develop and deploy such a sophisticated and highly distributed system in a mere three months time illustrates the “acceleration” inherent in the Apama platform,” he says.
As part of the implementation, Standard Chartered has installed a set of custom FX algorithms that allow traders to execute trades across the varied venues.Â Traders have extensive ability to parameterise the trade algorithms to enhance their ability to make or take orders based on fluctuations in currency positions.
The aggregated view of liquidity and pricing depth across the different venues also means that traders are able to determine the volume weighted average price (VWAP) for heavily traded currency pairs.
The implementation includes a custom Java-based User Interface created within the Apama development framework. The User Interface gives traders customised views of FX liquidity, including separate panels for groups of currency pairs, which can be tabbed, docked or floated.
Standard Chartered traders can make and take FX orders using a traditional FX trader keypad that has been integrated with the Apama FX Market Aggregator. Though the first phase involves directly-quoted spot FX trading, Standard Chartered says it plans to support synthetic currency pair crosses and other asset classes. “As we develop experience with Apama, we will look to employ the platform to support trading in other assets, which may include bonds and rates,’ says McDonald.
Dr. John Bates, founder and general manager, of the Apama division adds, “Over the last two years foreign exchange market fragmentation has increased with the creation of new FX trading venues. The drive of algorithmic trading continues to influence FX and its growing popularity created a need for greater algorithm differentiation in the face of intensifying competition. We have seen tremendous interest in our FX aggregator by a large number of firms who, like Standard Chartered, can have a single, yet customisable view of the entire fragmented market.”