Tag: Principle 17

Principle 17

GFXC Unveils Principle 17 Re-Write

The Global Foreign Exchange Committee (GFXC) has published an update to the FX Global Code, one that incorporates revised guidance on trading in the last look window, known as Principle 17.
The revised Principle 17 states that market participants should not undertake trading activity that utilises information from the client’s trade request during the last look window. It also describes the conditions under which certain trading arrangements (sometimes referred to as ‘cover and deal’) may be distinguished from this guidance.

GFXC Frowns on Trading in the Last Look Window…with Exceptions

The Global Foreign Exchange Committee (GFXC) met this week to consider the results of its consultation over the wording in Principle 17 of the FX Global Code of Conduct, specifically relating to the use of last look, and says it has concluded that Principle 17 “should indicate that market participants should not undertake trading activity that utilises the information from the client’s trade request during the last look window”.
At the same time, however, the GFXC has recognised the concerns by some involved in the feedback process that such an action would negatively impact the quote and cover, or riskless principal model

And Finally…

The feedback period for Principle 17 of the Global Code – dealing with last look in FX markets – is over and we await the outcome. My understanding is that the outcome will not be as clear cut as many thought just a short while ago, but, sticking my neck on the line, I am happy to predict which way the decision will fall. After all, the legal industry is already circling FX on this issue – why give it more ammunition?