Tag: Best Execution

Best Execution

And Finally…

As part of the public service duty of this column (and especially as a warning to any stag parties thinking of going there dressed as Robin Hood and his Merry Men), I feel the need to point out that a law exists in York, England, that says it is legal to murder a Scotsman within the ancient city walls, but only if said Scot is carrying a bow and arrow.
Clearly this is a law that has no basis in reality and is backward looking – however it is only slightly worse than MiFID2 when viewed through the prism of the FX market.

GTX to Offer Independent TCA

GTX has partnered with Ideal Prediction, an independent trading analytics and data science company, to offer its clients analytics aimed at to optimising their FX trading.

The market data, tools, and services are designed to enable buy-side and sell-side market participants to optimise profitability and simulate strategies, as well as perform Transaction Cost Analysis (TCA).

GTX says in a release announcing the partnership that it will further enable sell-side market participants to benchmark execution performance, analyse client flows, and optimise risk management strategies.

XTX Hands Buy Side New Liquidity Analysis Tool

XTX Markets has made XTX-ray, a tool designed to replicate how sell-side market makers analyse spot FX liquidity, available to buy side market participants.

XTX-ray looks at a wide range of data, including fill ratios, the cost of rejected trades in USD, spreads and market impact, to reveal “hidden” costs embedded in firms’ spot FX execution with the aim of enabling them to more effectively analyse the liquidity they are accessing.

“XTX-ray makes state-of-the-art sell side execution analysis available to buy side firms, and counterparties will be able to evaluate the execution quality of their liquidity providers.

2016 Crystal Ball: How Did We Do Last Year?

In the interests of total transparency we also, as usual, cast our eye over last year’s predictions to see how they went. As always, these predictions will be viewed through rose-coloured spectacles to ensure we look as good as possible!

We kicked off last year’s predictions by suggesting the entire FX world would take a more realistic view of developments – that liquidity and spreads would reflect this thought process, and that market share would be a declining influence in business decisions.

JP Morgan to Offer Independent TCA Through BestX

Profit & Loss understands that BestX, the start-up technology company that provides independent trading analytics, has signed JP Morgan as its first major FX sell-side client.
The deal marks a significant step forward in the industry as it represents the first time a major dealing bank has integrated a truly third party’s service to offer post-trade verification of execution quality. It will allow the bank’s own clients to independently define, achieve and demonstrate best execution through a post-trade transaction cost analysis (TCA) when trading electronically with the bank.

Does the WMR Still Serve a Valid Purpose?

Alex Dunegan, founder and CEO of Lumint, talks to Profit & Loss deputy editor, Galen Stops, about the challenges facing the buy side around selecting and evaluating benchmarks.

The WMR benchmark has come under severe scrutiny since the allegations that banks colluded to manipulate it, leading to changes in the way that the benchmark is calculated and questions from buy side firms about whether they should be using it at all.

Dunegan claims that this is a “critical” question, and provides his take on the answer.

Thomson Reuters Partners with BestX for TCA Solution

Thomson Reuters has partnered with BestX to enable buy-side participants using its FXall and FX Trading platforms to streamline analysis of transaction costs, helping them define, achieve and demonstrate best execution.
Through the partnership Thomson Reuters will offer connectivity to the independent transaction cost analysis (TCA) service from BestX from its FXall and FX Trading desktops.
Thomson Reuters customers will be able to have their trades sent automatically to BestX for independent post-trade transaction cost analysis, and also have a single sign-on desktop integration.

BestX Rolls Out First Product

BestX, formed earlier this year, has released its first TCA product. Colin Lambert takes a look.

If there has been a positive outcome from the trials and tribulations of the FX market in recent years it has been more focus on not only achieving best execution, but also about what that phrase actually means. This has resulted in more products and services aimed at helping clients make informed decisions around how they interact with the FX market – no longer is it just a sideshow that can be handled without due care and attention – as well as the gradual move into the market of new firms.

P&L Talk Series with Petra Wikstrom

Petra Wikstrom, global head of Execution and Alpha solutions at BNP Paribas, talks to Profit & Loss about why FX TCA benefits from “a pragmatic engineering approach”.

Profit & Loss: When it comes to producing meaningful TCA, what are the big data challenges facing market participants?

Petra Wikstrom: Over the last five years we’ve seen a constant uptick in the electronification of FX, but the number of venues offering FX liquidity has increased far beyond that, which means that similar volumes are now offered across more venues.

ESMA Provides More Clarity on BestEx Rules

The European Securities and Markets Authority (ESMA) has published a Q&A document seeking to clarify expected standards around certain practices, including best execution.
The questions have been set following feedback and enquiries from the general public, other regulators and market participants.
On best execution ESMA publishes two Q&As, the first explains the different between the “reasonable steps” firms were expected to take to obtain the best possible execution under MiFID I and the “sufficient steps” they are required to take under MiFID II.