Goldman Sachs has launched a Basket Algo, which gives clients the ability to take numerous FX trades and then trade them as a basket.“The launch of this algo came from really recognising the pinch points of clients’ workflows and understanding what they’re trying to achieve,” David Wilkins, global head of e-FX sales at Goldman Sachs, tells Profit & Loss. “And I want to make it very clear: this is not any kind of simple trade batch uploader. Indeed, we think this is an entirely new way to trade FX.”The essential thesis behind the algo is that deeper examination of client workflows and trading activity shows that although these firms tend to execute trades on an individual basis, in many cases, they don’t need to be, and it would in fact be cheaper and more efficient for them to instead execute them as a basket.
With P&L’s editor Galen Stops showing his contempt for the listenership by declining to call in to the podcast from halfway down a black run on a snowboard, this week’s In the FICC of It takes a look back as managing editor Colin Lambert is joined by P&L’s founder Julie Ros, just over 20 years to the day she incorporated Profit & Loss.
Although they somehow manage to omit to mention how they wrote pieces for the magazine about Caribbean and Scottish holidays and, even worse, took their own cover pictures, the two look back to the early days of e-FX, which coincided with the launch of Profit & Loss, and look at how things have changed – and in some cases have not.
The names of the leaders in e-FX may have changed, as Ros notes, but our two podcasters agree that there is much that remains the same, in both the single and multi-dealer platform world especially.
One week after Stops and Lambert went to town on each other’s predictions for 2019, Ros offers Lambert to chance to critique someone else’s predictions for the foreign exchange industry, made in 2000, and you will glad to hear that in spite of the aforementioned clairvoyant going onto to become Prime Minister of his country, Lambert shows his customary disregard for rank and gives it both barrels…
In the Profit & Loss 2018 Digital FX Awards, Barclays was the winner of the “One to Watch in 2018” category and, looking back now at the end of the year, it seems that the bank might be on its way to justifying this decision.
After a couple of years during which there was a clear slowdown in terms of product development within Barclays’ e-FX franchise, the bank appears to be shifting onto the front foot again.
It has made a raft of senior appointments within its FX business this year, with Alex Shterenberg hired as global head of G10 and EM e-FX trading, Jeremy Monnier as a managing director, Fabio Madar as the global head of G10 FX trading and distribution, James Hassett as global head of EM macro trading, and Mauricio Sada-Paz as global head of e-FICC product and distribution.
Galen Stops examines the extent to which banks in different emerging markets face the same challenges when trying to build out their e-FX businesses, and questions the extent to which technology developments in these markets will follow a familiar pattern.
Talking broadly about how firms in emerging markets operate is often misleading, given the diversity of these markets and how widely the demands and conditions vary within each one. And yet, when it comes to banks in emerging markets that are looking to build out their e-FX businesses, there are some common themes that can be identified. For starters, these banks actually tend to have a sizable and often fairly diverse customer base, although each of these clients tend to trade FX on a smaller scale in terms of transaction size compared to their counterparts in more developed countries.
Volumes in NDF markets have increased dramatically in recent years, but what is behind this accelerated activity and will it continue? More importantly, what role are the lessons learned from the G10 markets playing? Colin Lambert finds out.
The biggest growth story in foreign exchange over the past two years since the Bank for International Settlements’ 2016 Triennial Survey of FX Turnover has largely taken place in the shadows, for while spot volumes have largely plateaued, activity in the non-deliverable forward segment has grown exponentially. NDF average daily volumes, as reported by the UK and US foreign exchange committees, is 50% in the two years from April 2016 – a pace of growth no other product can match.
FX post-trade processing network provider Cobalt has appointed FX industry veteran Darren Coote as managing director.
Coote has been working with Cobalt since the end of 2017 as a strategic advisor and will now take on responsibility for the day to day management of the company. The firm says the appointment comes at a key time for Cobalt as the company launches and looks to significantly scale its business. Coote brings over 25 years’ experience in the FX business to Cobalt.
Profit & Loss understands that Liam Hudson is joining BGC Partners to run its e-FX businesses, including Fenics FX, which was launched last year, MidFX and the electronic FX options offering.
Hudson was last at Bank of America Merrill Lynch in London where he was global head of e-FX for more than eight years.
Hudson joined BAML from Barclays, a firm he joined when it took over the FX business interests of Lehman Brothers. At Lehman, he spent seven years in the e-FX business, including helping develop the FXLive platform as well as the firm’s algo execution capabilities.
Henry Durrant has joined Gain Capital’s GTX – he started last week in London and is reporting to Steve Riley, head of liquidity at the firm.
One of the reasons I enjoy our conferences so much is the capacity of the high quality speakers with whom we are fortunate to engage to raise a point that just makes you think, “why have we not done this before?”
This week we held our inaugural Frankfurt conference and during our Technology Futures session the discussion turned to the role of technology in making markets safer. It was one of those great sessions where I turned up to moderate armed with a bunch of themes and questions following (ahem) “extensive research” and got to ask one of them!
Ian O’Flaherty has left Deutsche Bank after a 35 year career at the institution, most of it in FX.
After more than a decade and half on the trading desk, O’Flaherty shifted to the e-commerce side and was a key part of the team that transformed Deutsche’s FX business into the electronic era, being heavily involved in the creation, building and development of its single dealer platform, Autobahn. In 2015 O’Flaherty was named as co-head of Deutsche’s Institutional Client Group debt e-commerce sales.