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Tech Corner

Foreign exchange broker ADS Securities and global managed services provider has installed a 40Gb ethernet network in Tokyo (TY3). The deployment in uses 40Gb network cards and allows for each tick from multiple liquidity venues to be processed with reduced delays as the additional bandwidth mitigates microbursts in volatile market conditions. With an ever increasing number of liquidity venues, the companies say the 40Gb technology provides capacity for existing and future growth.

Software AG has combined its Apama FX e-commerce solution with Fluent Trade Technologies’ Fixation Framework to create a fast feed handler and an execution gateway with connectivity to more than 60 FX venues in a single API. Additional capabilities include algorithmic trading, cross-venue smart order routing, pricing, auto-hedging and order internalisation strategies. According to the companies, the new FX trading surveillance platform allows traders to pinpoint and respond first to the best prices in the market, while at the same time reducing their firm’s exposure to potential high frequency trading risks. In addition, compliance officers can uncover abnormal trading behaviour and avoid suspect conditions, as well as define new internal compliance and rules.

Message Automation says it has been investigating the impact of increased operational risk and costs due to fragmentation of OTC derivatives processing among its clients. The derivatives connectivity and regulation specialist discussed these issues with buy- and sell-side firms across Europe, Asia and North America and found that financial firms are having to rethink their operational strategies for OTC derivatives. Instead of harmonisation and risk reduction, the involvement of a growing number of new third parties including clearing houses, execution platforms and trade reporting repositories has actually made the processing and management of OTC derivatives even more difficult, the firm adds.

Its findings tie in with benchmark survey statistics released in advance of the Clearing and Settlement World 2014 conference in November. The report highlights that 81% of respondents see managing data quality as their biggest challenge, while only 23% believe that regulatory changes will reduce risk. Message Automation says it is attempting to facilitate the interaction of major firms with trade repositories, clearing houses, clearing brokers, swap execution facilities (SEFs) and affirmation services when processing OTC derivatives.

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