P&L Report Card: These awards cover most aspects of the client experience when it comes to the various e-services and products on offer, indeed a read back through 15 years shows how the categories have changed to reflect the changing demands of the client base and, sometimes in the short term, new areas of competition. It is now two years since we started polling users on the overall experience and what they liked and disliked about a platform and we continue to be grateful that the reaction to the award was positive. The Client Experience Award really represents the core ethos of these awards – how good is the overall experience for someone using these platforms?
Tag: Digital FX Awards
Digital FX Awards
P&L Report Card: The next 18 months are going to be interesting for the banks’ research teams, not only do they have a rather erratic geopolitical situation to deal with, but they are also firmly in the firing line over MiFID II. Post-January 1, 2018 will be the time when we learn a lot more about how important clients actually think research is, and while paying for research is only a small part of the regulation, it will have a large impact on this segment of the FX business.
We have noted previously that the more in-depth reports are lightly read – partly this is a question of time, and partly it is a question of the value of such reports.
P&L Report Card: This is the second year for this award, one that reflects the continued interest around understanding execution quality. While we look at the overall experience in our Best Execution Award, a crucial element in any client’s experience, especially in event-driven markets where liquidity can be sporadic, is the pretrade functionality, which is where we focus this award.
The past year has seen more clients understand the critical importance of the decision-making process, specifically when and how to execute that crucial hedge, or how to get into that position without tipping the world off to what you are doing (it can also work the same on the way out!) The changing nature of markets also makes the liquidity view important.
P&L Report Card: Did anything happen in the prime brokerage space last year? For the second year in a row, developments in this field were few and far between, which probably indicates the focus on making sure risk systems are fully up to scratch on the part of providers. It obviously started with SNB Day, but has continued with a few further market events, and as a result the major PBs have not only continued to cut some of the tail risk among their client bases, but they have increased their monitoring of existing clients as well.
P&L Report Card: For yet another year we were thinking (yes, we know that should read “hoping”) that 2017 would be the year in which the FX options market’s structure was finally sorted out. We were optimistic over the availability of clearing services, customers were more open to structured solutions to their hedging problems, and the multi-dealer world – something we consider to be important for a market’s development – was looking up. A year on? Well not a lot has happened.
Volumes continue to struggle in the public markets and clearing has not taken off, but at least the event-driven nature of markets means that customers still see value in FX options. So, the future of the market is no closer to being defined than it was a year ago (actually, if we are being honest, four years ago).
P&L Report Card: Structured products continues to represent a broad church – there is a focus on FX structured products here, but it should not be ignored that it is also about wider investment products and the ability to build a basket of investments.
Clearly any bank with a healthy private client franchise is going to score well here and indeed UBS’s structured products sit very well within Neo. Credit Suisse, likewise, continues to keep pace and users like its Index functionality, which two years ago added basket building capabilities, a la Barclays, to its suite of services.
P&L Report Card: One of the more pleasing developments of the past few years has been the arrival and general acceptance of mobile trading. It is now accepted by clients (and importantly their compliance function) to the extent that a good mobile app can be a differentiator when selecting key relationships. We accept that mobile remains something of a niche market because there just aren’t that many customers who want to execute out of hours, but those that do typically tend to be “valued” clients and as such, are important to the bank.That more people are using mobile devices for trading as well as information is thanks in no small way to the banks doing a great job of enhancing the security and compliance procedures around the process.
In broader society, the year 2016 was a dichotomy – it was a horror year in terms of global celebrities passing away, especially musicians, but it was a great year if you are a fan of sports teams like Leicester City or the Chicago Cubs.
Likewise, it could be easy to claim that 2016 was a horror year for e-FX in terms of product development and budget for anything other than compliance and regulation; however, there were pockets of optimism in the industry. It should also be noted that in terms of product delivery, the slowdown is natural and should have been expected – after all, if you already offer most products and services it is difficult to add to them.
P&L Report Card: The rates space remains in a state of flux, in spite of regulatory certainty finally being established. The confusion – such as it is – stems from whether banks are principals in the business or not. The general mood is that they don’t especially want to be, but as always, there are different thinkers. We continued to be uncertain going into this year’s awards process whether this award has merit given the general move towards SEF (or similar) trading, but we are happy to report the rates business has had a stay of execution from Profit & Loss for at least another year!
P&L Report Card: This really is a story of two institutions. Yes, there are many excellent precious metals providers out there but telling them apart is different, and yes, an increasing number of players are offering options on precious metals, as well as more cross currency opportunities. The fact is though that precious metals are viewed by investors, and us here at Profit & Loss, as just another currency pair.
This means we tend to look further afield when looking at commodity providers, especially into the base metals and energy products. With this in mind, and given there are two very good providers – Goldman Sachs and JP Morgan – that stand out from the crowd, we are going to ruin the suspense of this award by highlighting the excellence of both platforms, one here and one in the award winner’s section.