Tag: Liquidity

Liquidity

Flow Traders: Standing Out from the Crowd

Robbert Sijbrandij, head of FX at Flow Traders, talks to Galen Stops about why he thinks there’s still room for more non-bank liquidity providers in the FX market.Dutch proprietary trading firm, Flow Traders, has spent the past two years building out its FX business line. The firm trades in the region of €750- €800 billion of ETFs per year, of which roughly two-thirds has an FX angle, meaning that Flow Traders was already doing in the region of €2-3 billion of FX on a busy day before they decided to become a liquidity maker in FX.

Flash Crash or the New Norm? Deciphering January 3

The foreign exchange industry got an early reminder of risk when on the second full day of trading this year the market saw another flash event. What, if anything, does this mean for FX market liquidity and volatility in the year ahead though? Colin Lambert finds out.The very sharp moves seen in FX markets at the start of the year triggered yet another round of introspection over conditions in the FX market with commentators pointing the finger of blame at one or more of algos, news from Apple, thin markets, Japanese retail and poor execution. Although Profit & Loss understands that industry players have been approached for data logs by certain regulators, the chances of an investigation turning up a convincing catalyst for the moves are thin.

Flash Crash or the New Norm? Deciphering January 3

The foreign exchange industry got an early reminder of risk when on the second full day of trading this year the market saw another flash event. What, if anything, does this mean for FX market liquidity and volatility in the year ahead though? Colin Lambert finds out.The very sharp moves seen in FX markets at the start of the year triggered yet another round of introspection over conditions in the FX market with commentators pointing the finger of blame at one or more of algos, news from Apple, thin markets, Japanese retail and poor execution. Although Profit & Loss understands that industry players have been approached for data logs by certain regulators, the chances of an investigation turning up a convincing catalyst for the moves are thin.

Barclays Launches New Algo

Barclays has added a new algorithm, BARX Peg, to its e-FX trading platform.Available within Gator, the algo is designed to allow clients to minimise both the amount of spread paid and market impact by accessing Barclays’ franchise liquidity pools so that trades can be filled entirely through internalisation.The algo has five different target execution rates which provide exposure to Barclays’ liquidity through a variety of channels, including: the BARX single dealer platform (GUI), multidealer platforms and API connections. The execution rates, which represent the varying speed at which fills may occur, range from fast, which includes all 5 Barclays franchise liquidity pools, to slow, which only includes the GUI.However, Barclays notes that utilising the algorithm may reduce the certainty of execution.

Flow Traders: Standing Out from the Crowd

Robbert Sijbrandij, head of FX at Flow Traders, talks to Galen Stops about why he thinks there’s still room for more non-bank liquidity providers in the FX market.Dutch proprietary trading firm, Flow Traders, has spent the past two years building out its FX business line. The firm trades in the region of €750- €800 billion of ETFs per year, of which roughly two-thirds has an FX angle, meaning that Flow Traders was already doing in the region of €2-3 billion of FX on a busy day before they decided to become a liquidity maker in FX.

The Profit & Loss Crystal Ball

Once again, it’s that time of year when our editorial staff dust off the infamous Profit & Loss crystal ball in order to take a peek into the future and tell our readers what they should expect from the year ahead. Colin Lambert’s “Trade of the Year” makes a welcome return, and he’s back with a bang as he focuses on the drivers of the ever-popular NOK/MXN pair. As has become custom, Lambert is also predicting consolidation within the FX industry, but regular readers might just be surprised to find out that for once he doesn’t think that the M&A activity will be on the platform side this year.

Nostradamus with Splinters

Having taken a look at Galen Stops’ predictions for 2018, Colin Lambert decides that overall he didn’t do a bad job, but there is an obvious reason why…Obviously having been a very generous marker over the years when assessing my own predictions from the previous year I have now swung 180 degrees and plan on being as critical as possible when looking at Galen’s five key themes for 2018. The problem is that, overall, he didn’t do too badly. Firstly, he suggested that 2018 could be the year that active currency management makes a comeback, although – and this is a theme of this review – there was a caveat because the headline ended with the words “sort of”.

Close, But No Cigar

Having taken a look at Colin Lambert’s predictions for 2018, Galen Stops finds that he was almost right with all of them. “Almost” being the operative word.…..1.“Bitcoin. That’s The Thing That Goes Up, Right?” – “The advent of futures in Bitcoin will take volatility out of the market. The cryptocurrency will end the year lower, not at zero, but in the single digits of thousands of dollars.” Colin definitely scored a hit with his price prediction, with bitcoin currently at $3,500 at the time of writing. However, he did give himself a rather generous amount of leeway by effectively predicting that it would end the year anywhere between $1 and $9,999.

P&L’s 2018 Crystal Ball – How Did We Do?

We’d all like to write our own reviews, but if the recent emphasis on third party transaction cost analysis (TCA) has taught us anything it’s that it can be beneficial to have an independent party conduct reviews too. With that in mind Profit & Loss challenged some of its readers to look over our 2018 predictions and provide feedback.Prediction: “The Great Divide” – 2018 will be all about the data and it will empower those willing to pay for it, however there will be challenges for those who cannot or will not pay up to consume and store the vast amounts of data required. Those with data will be more protective of how their pricing is used by counterparts and those without will struggle in an increasingly fragmented market as more platforms package and sell their data.