Tag: LMAX Exchange

LMAX Exchange

Market Impact: Friend or Foe?

Speakers at the Profit & Loss Forex Network New York event highlighted that how you define, measure and respond to market impact when trading FX depends on a number of different variables. Opening the discussion ‘Market Impact – Finding Execution Styles that Work’ moderator Paul Aston, the CEO of Tixall Global Advisors, argued that while […]

Rupan Joins LMAX Exchange

LMAX Exchange Group has appointed Randy Rupan as head of liquidity analysis. Based in New York, Rupan will report into Jeremy Barnes, global head of liquidity management.He joins LMAX Exchange from 360T, where he worked as head of spot FX for the Americas since May 2018. Prior to that, he spent six years at FastMatch, where he was head of institutional liquidity management, and nine years at FXCM, where he was last a vice president doing business development for the firm.

LMAX Financials Show 2018 Growth

LMAX Exchange Group has reported financial results for 2018 showing that its gross revenues, profits and EBITDA were all up year-on-year.The firm reported gross revenues of $50 million, gross profits of $45 million and statutory EBITDA of $18.6 million – increases of 27%, 35% and 62%, respectively, from 2017. Operating profit was $13.4 million in 2018, up 135% from the previous year.LMAX cites a 21% increase in trading volumes across the platforms that it operates as the driver of these figures, although the platform does not publicly report the actual volumes themselves. In particular, the firm highlights Asia Pacific as a major growth area in 2018.

The Institutionalisation of Crypto: Patience Required

Institutional investors will start to trade in cryptocurrencies, but the price crash last year has put a hold on their plans. That said, as David Mercer, CEO of LMAX Exchange, which owns the institutional crypto platform LMAX Digital, observes, “All the names you’d expect are looking seriously at crypto.”
LMAX Digital was launched into a bear market, something Mercer wryly suggests is something you wouldn’t choose to do, but he remains optimistic in the long term. “We set up LMAX Digital purely for the institutional space, but at the moment it is probably at one-to-five percent of its potential – it remains largely retail-orientated,” he says

Exchanges in FX: A Game of Musical Chairs

In recent years, large exchange groups have been lining up to buy OTC FX platforms. But in this game of musical chairs, what happens to the venues without a buyer when the music stops? Galen Stops reports.One of the major trends in the multi-dealer platform space in recent years has been the acquisition of these platforms by larger exchange groups. Hotspot was the first to go after it was bought by BATS Global Markets in 2015, which in turn was then acquired by Cboe Global Markets in 2017 and the FX platform was rebranded as CboeFX.

Exchanges in FX: A Game of Musical Chairs

In recent years, large exchange groups have been lining up to buy OTC FX platforms. But in this game of musical chairs, what happens to the venues without a buyer when the music stops? Galen Stops reports.One of the major trends in the multi-dealer platform space in recent years has been the acquisition of these platforms by larger exchange groups. Hotspot was the first to go after it was bought by BATS Global Markets in 2015, which in turn was then acquired by Cboe Global Markets in 2017 and the FX platform was rebranded as CboeFX.

Reducing Latency in FX: Necessary but a Challenge

For platforms looking to differentiate on the speed of their technology the equation is measured in the scale of the challenge rather than the opportunity. As David Mercer, CEO of LMAX Exchange observes, “You can’t differentiate on speed, but you have to keep in line with the best in the market – and that means cost.”
Liquidity providers have to be able to update their prices as quickly as possible, and likewise, trading venues have to deliver price updates to their customers as efficiently as they can, to facilitate a fair trading environment. “Five years ago market data was being delivered at 100 milliseconds, then more recently it was at 5 milliseconds,” notes Mercer. “At LMAX Exchange we are live streaming and cancel and replace of orders is measured in microseconds, but already people are talking about nanoseconds – and that’s a challenge for us.”

LMAX Exchange: Master of Its Own Destiny

“2018 was a transitional year for foreign exchange,” reflects David Mercer, CEO of LMAX Exchange Group. The first thing he points to in order to back up this claim is the impact of new regulations, which changed the way that LMAX Exchange did business in a number of areas. For example, because of Mifid II, it had to separate its brokerage and its Multilateral Trading Facility (MTF) businesses, LMAX Global and LMAX Exchange, respectively. This process largely consisted of vast piles of paperwork as the firm was forced to re-paper clients. In addition, Mercer says that in 2018 there was a reconfigurement of the FX market structure, driven in large part by the FX Global Code and the entrance of larger exchange groups into the OTC market via platform acquisitions.