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The 2003 Digital FX Awards Eye on the Client

After reviewing nearly 30 bank-offered websites, Profit & Loss magazine picks out some of the most outstanding services available to clients. On the following pages you will find the second Profit & Loss Digital FX Awards.

It would appear that the debate over whether it is better trading FX online or off has finally been settled. Clients are voting with their business and all respondents in the 2003 Profit & Loss Bank Guide to e-Services in our February 2003 issue reported an uptick in online trading volumes.

This begs the question then, where should clients be pushing their business? Whilst the debate on the multibank model is still active, the banks themselves have worked hard over the past two years to provide their clients with all the tools they need for online execution.

As we stated in the inaugural awards feature last April, it remains clear that the services offered online reflect the quality of the services offline. A good online offering is heavily dependant on the traditional services and quality of staff at each institution.

These awards, however, are based upon the tools and services provided by the banks as judged by the team at Profit & Loss who have reviewed the offerings of a short list of finalists. Here then, in the independent view of the editorial staff, are the 2003 award winners.

The first thing that strikes one viewing the multitude of bank systems on offer is how much they have improved over the past year. Although in terms of groundbreaking developments it has been a relatively quiet year (with a few exceptions), all banks have been working hard on adding to their clients’ online experience. “A year of tinkering with the system” is how one survey respondent put it, a statement that seems to speak for the majority.

Last year we viewed two systems as standout offerings – UBS Warburg and Goldman Sachs – and whilst this is still our view this year, the pack has closed and is hard on their heels.

There also seems to be a move to widen the product spectrum. There are many more banks offering online derivatives execution than previously, while much has been done to create multi-product platforms for clients who are, after all, increasingly looking to deal with institutions across the complete spectrum of products, not just FX.

As we stated last year, the reader is asked to remember that all things are relative and that in many cases the difference between a winner and a runner up is often the thinnest of margins. Our decisions have been based upon what we have been shown by the banks themselves over the past year, but we have also taken into account feedback of some of the clients themselves.

Digital FX Awards

Best Overall Site

UBS Warburg

Best Multi-Product Offering

Goldman Sachs

Best Research Tools


Best STP

The Bank of New York

2003 Profit & Loss Award for Innovation

JP Morgan

Best Navigation


White Label Award

Deutsche Bank

Best Order Management

Deutsche Bank

Best Multibank Portal (FX)


Best Multibank Portal (Multi-Product)

Global Link

Most Improved Site

JP Morgan

Best FX Options Platform

Goldman Sachs

Best Range of Execution Tools


Most Client Friendly Site

UBS Warburg


Best Overall Site – UBS Warburg

For the second year in succession, UBSW shaves this from Goldman Sachs. The bank has spent a lot of time and resources making sure the best – in our opinion – got better. It is hard to pin down a significant enhancement UBSW has made over the past year; however, it can be said that just about every part of the site has been improved.

The scope of research remains hugely impressive, as is the still relatively unique ability on the part of clients to open a pre-populated trade ticket from research items, depending upon whether they agree or disagree with the sentiment.

Dealing floor buzz is a particularly strong feature of the bank’s research offering because, for all the excellent service a sales desk provides, there is nothing quite like getting inside the head of the trader responsible for making a market. UBSW’s research covers the entire spectrum – as do many others – but few provide the thoughts of their traders; this is a key differentiator.

The navigation, the pricing engine, the post trade services – all are of the highest quality and importantly, in our opinion, they service a very wide range of clients in terms of both size and segment. Clients of UBSW, be they other banks, asset managers or corporates, have been catered for on the site. It is this range of products and target audience that makes it a winner in our opinion.

Reinforcing this opinion is UBSW’s outstanding FX option platform which sits within the overall site, providing execution services and STP. Streaming volatilities and the bank’s proprietary analytics package, VolCast, provide what amounts to click and deal for the more professional user. For the less sophisticated options user, tickets can be opened from the bank’s pricing model to ensure details are correct before execution. If all this were not enough, the bank has spent much of the past year broadening the range of options products offered online, and many exotic products are tradable on an RFQ basis.

Perhaps the ultimate compliment we can pay the UBSW site is that it is clearly admired by its peers. Several new tools we viewed on rival bank sites had a similar look and feel to UBSW’s model. This suggests to us that those banks are listening to their clients and are being told that much of what UBSW does, it does best.

The navigation of the site, the breadth of options trading functionality (it has also recently added an FX prime brokerage silo) and the robust technology mean that UBSW’s site remains the ‘varsity’. We also like the fact that the bank is protecting its own interests by enabling traders to see the interest in their prices. There is a suspicion that some banks have overlooked the risk management aspect of auto-pricing in the kind of amounts they do. UBSW auto-prices in large amounts, but its risk management controls are tip-top, another example of how the bank pays attention to detail.


Best Multi-Product Offering – Goldman Sachs

Also for the second year in succession, our second award goes to Goldman Sachs; indeed it is getting hard to distinguish between what we consider to be the top two systems. The Goldman approach has been to focus their development efforts upon their client base, they have yet to build out to the extent perhaps that UBSW has done.

What WebET, the Goldman site has however, is a vast array of products that can be traded by clients, all with the same look and feel. As we stated last year, we are less concerned by the basic FX trading functionality – most of the systems we viewed have had similar characteristics, it is normally just a question of how long it takes for a price to be delivered. We are more interested in how the spot trading process is linked into other areas of the FX business – and this is where the Goldman offering is so strong.

Aside from the fact that the system has a superb options package (as we discuss elsewhere in this feature), clients are able to trade a wide range of fixed income, equity and non-FX derivative products on the site. WebET also has a comprehensive prime brokerage facility.

Prime brokerage is becoming an increasingly important product in today’s credit-wary markets and Goldman has a very strong offering that provides trading capability (via the core FX product into which it is embedded) and a full suite of information tools. Particularly impressive is the use of graphics in the display of credit status and the fact that rolls can be executed direct from the client’s position page.

It is possible to drill down into the prime brokerage model to great depth, something that provides excellent MIS for clients’ risk management functionaries. Clients can also access a wide range of tools to help them analyse and better understand where they are positioned in the markets. Options trading is also supported on the prime brokerage silo.

Goldman says it is happy with the number of clients using its e-prime brokerage facility; looking at the system it is easy to see why they are attracting client numbers. Overall, WebET sets a benchmark for an investment bank platform that others may find hard to attain. Plans for a new rollout that embeds these products even more closely are apparently well-advanced; Goldman clearly intends to stay at the head of the field.


Best Research Tools – HSBC

This award is not so much a question of the spread of research available as it is about helping the client filter the vast amount of information. Not unlike many in the market, our winner has an enormous amount of research available for clients on a global basis, but what won them the award is how they have enabled clients to access this data.

HSBC has spent a lot of resources ensuring that its research is delivered in a fast, efficient and easy to access fashion for clients. When you are publishing over 400 documents a day globally as HSBC does, being able to pinpoint the right document[s] is vital.

To help their clients manage the wealth of reading available to them, HSBC has created configurable filters which can be saved under various tabs. This means the client is not only able to filter the research at regional or market segment level, but they can then drill down further by creating what the banks calls a “My Portfolio” window. This window is embedded across the entire site to ensure it remains on the top page being displayed. It is automatically refreshed whenever new research is published according to the filters established, meaning clients are instantly aware of the new information – there is no need to keep checking the site.

The amount of research produced is one of the biggest problems facing both the banking industry and their clients. Managing the huge amount of data in as efficient manner as possible is paramount for both sides, which is where the HSBC platform is so strong.

Honourable Mentions: JP Morgan, UBS Warburg


Best STP – The Bank of New York

Straight-through processing is a difficult award to hand out, purely because standards in the industry have grouped to the extent that all are offering end-to-end processing (up to actual payment) in pretty much the same fashion.

We remain impressed by the efforts that the Bank of New York makes. The bank has spent much of the past year enhancing its messaging and post-trade activities for its clients aimed at providing instant notification of any trades via its iFX module.

Clients can execute FX trades directly off their equity or fixed income transactions, and can allocate pre- or post-trade. The site also delivers distributed message structures for pension fund managers and trustees.

Although BoNY is predominantly seen as an institutional bank, it does also cater for corporate users. The fact that it is willing to do bespoke work for so many of its clients speaks volumes about its commitment to STP.

The bank is also one of the most vocal about the necessity of capturing trades in one’s own backyard (namely, internal clients), thus ensuring that the efficiencies it offers externally are also enjoyed internally. What this means is the bank is aware that electronic efficiencies can be gleaned from a number of sources, an obvious point which, it seems, is sometimes missed.

Honourable Mentions: State Street, Citibank

2003 Profit & Loss Award for Innovation – JP Morgan

Many thought that in the wake of the explosion of FX e-commerce platforms witnessed since mid-1999, the banks would be content to add functionality and perhaps the odd FX-related product. Of course, the reality is that FX can be termed a by-product of all other asset classes. Therefore the bank that links execution, for example, in fixed income, with its FX engine is taking huge steps towards replicating the “full service” they seek to offer offline via the more efficient e-channel.

The most innovative tool we saw over the past year, during which time many organisations added bells and whistles, was JPeX, JP Morgan’s multi-asset class trading tool. Using JPeX, clients can set up trading tabs to enable them to execute any amount of fixed income products and then click on the FX tab for live streaming prices, with market depth.

The core currencies are auto-priced, the less liquid markets RFQ’ed, but in terms of making steps toward a seamless, multi-asset class trading environment for clients, JP Morgan has taken a lead with an innovative product that enables clients to execute FX trades off a fixed income trade with just three clicks.

Honourable Mention: Centradia’s multi-lingual capabilities


Best Navigation – HSBC

Over the last year, HSBC has concentrated on ensuring that its system is as customisable as possible, right across the board, and the results have been impressive. The site offers a simple path through the trading process – from research to post-trade completion.

Trading is not the key differentiating factor in navigation: there are only a certain number of paths to and from bid and offer. Where the HSBC offering stands out, as we discussed earlier, is in the way that the research page can be filtered to ensure that only news that the client is interested in gets through. This, coupled with the ease of setting up multiple profiles on the site which enables a user to switch between functions as their job demands (the industry increasingly demands trading professionals with knowledge of multiple products), is invaluable.

The fact that the filtering itself is a relatively simple process also makes the product stand out. It is all very well offering filters to clients, but if it takes an hour to set up a profile, it will never get done.

Users of the HSBC site can move around easily and swiftly, without relying upon a series of links, a process that can sometimes become tiresome. It is often forgotten in the rush to provide e-trading that execution is but a small part of the process. The ability to move swiftly and easily around a site in the pre- and post-trade is vital to enhancing a client’s online experience, and, more importantly, bringing them back to transact more business.

Honourable Mentions: UBS Warburg, Goldman Sachs


White Label Award – Deutsche Bank

As we discuss in the cover feature of this issue, the world of white labelling is becoming the next big battleground in banks’ search for market real estate. On the face of it, most banks’ systems would qualify for this award, for white labelling is predominantly about the provision of liquidity in a wide range of currencies and the STP to back it up, down the value chain.

Two things stand out about the Deutsche Bank offering. Firstly, the order management system, as we discuss elsewhere in this feature, is outstanding and offers clients great choice of execution and flexibility over where and when an order is watched. Secondly is the range of pricing and the price engine itself. Clients regularly tell us that Deutsche Bank has the quickest pricer in the market, although of course this is an ever-evolving environment.

By providing liquidity to its partners in over 200 currency pairs (more than 100 of which are streaming) on a 24-hour basis, Deutsche more than fulfils the basic service requirements. Users also have the ability to turn on and off auto-pricing as they desire, something especially important for those institutions with specific regional (time zone) or currency specialties.

Honourable Mentions: Barclays Capital, Citibank


Best Order Management – Deutsche Bank

This is the second year in succession that Deutsche Bank has won this award and quite simply, we do not feel that other institutions have even come close to knocking it off this particular perch.

From the fully configurable order entry screen, through the manner in which the orders are watched, to the choice of execution methods, this order management system is a winner. Throw in the fact that users can also white label this system to enable Deutsche to watch its clients’ clients’ orders (for want of a better expression), and the winner just disappears into the distance.

The flexibility of the system allows clients to forward any proportion of their own order book to Deutsche, it also supports a wide range of orders including “if done”, “loops”, “OCOs” and “if done OCOs”. Orders can be executed automatically against Deutsche’s streaming prices or manually depending upon the client’s requirements.

The flexibility of the order system extends to how the orders are managed intraday. Clients can select individual or multiple orders and send or cancel them, they can add specific details such as “good till cancelled”, or specify a time at which the order is cancelled. Even more innovatively, the client can automatically request a blackout period during which time the order is not live; however, a Deutsche salesperson will watch it and inform the client if the level is hit.

Underpinning the entire offering is the ultimate flexibility when it comes to orders. Clients can specify “all or nothing” fills in both stop-loss and take-profit orders, they can also allow partial fills for the latter. All in all, a very flexible tool that extends the efficiencies of e-trading into what can occasionally be the murky world of order management.

Honourable Mentions: Dresdner Kleinwort Wasserstein, UBS Warburg


Best Multibank Portal (FX) – FXall

We consider this to be a fairly easy decision because FXall appears to be establishing a healthy lead in this field. From the pre-trade process, through the (auto) pricing and execution, to post-trade services, FXall has evolved into a very rounded product for anyone looking to execute FX in a multibank environment.

The decision to break down their various services into “Centers”, which was taken early last year, has also been a key factor in the platform’s success in our opinion, for it has enabled them to focus much more clearly on what enhancements needed to be made to different areas of the trading experience. The platform has also benefited greatly from its foresight in insisting that all member banks auto-price to the platform and that they all publish research, thus enabling them to claim with justification that they are offering the widest possible service from the market’s leading banks.

It is hard to define what a dominant market position is in terms of the portal market, purely because it is still a relatively small element of the overall market; however, we consider FXall to be the best FX portal for both buy and sell sides.

Honourable Mentions: Currenex, Hotspot FXi


Best Multibank Portal (Multi-Product) – Global Link

It has long been the considered opinion of this publication that the multibank portal industry will ultimately have to reflect the service offered by its sell side institutions if it is to register any real and lasting degree of success. The modern concept of the bank-client relationship is very much the “full service” or “one-stop shop” ethos.

In terms of multi-product capabilities, Global Link stands out through its very strong FX, money market, equity, futures and fund products. However, given the strides by others in the field, the bank will have to consider direct connectivity between the differing silos if it is to maintain its position.

What differentiates Global Link is the services with which it surrounds its core transaction platforms. It has very efficient STP, which it tailors to the needs of its differing customer segments, and its pre-trade resources are incredibly strong. Indeed it is in the pre-trade that Global Link gives a glimpse of the future, as it brings together information from all of its transactional platforms to provide research and flow analysis of the highest order.

Honourable Mentions: 360T, Centradia


Most Improved Site – JP Morgan

As we stated earlier in this feature, all bank sites have improved over the last year, some in subtle and less obvious ways, others overtly. This award is not so much about which bank has added the most products or bells and whistles to its site, but more about which has most improved the online experience of its clients.

In this category we plump for JP Morgan. It had a strong product offering last year, in particular its research tools were stellar, however this year it has been improved across the board. Aside from the aforementioned innovation that is JPeX, JPM has worked hard on many aspects of its site. What is more impressive is that it has done it in a relatively short space of time.

As with the other partner banks in Atriax, JPM found itself needing to establish a presence on the other multibank portals to ensure it was not losing market share. This delayed the work on its own site, but it made up for lost time in the latter half of the year.

Improvements came across the board. The pre-trade functionality was enhanced with increased configurability for clients and more research tools. Existing research tools were also enhanced, as was the distribution of research.

Pricing remains a strong point with JPM. We were particularly impressed with the way it has added depth of market to its streaming prices, which enables clients to see exactly how much liquidity is available to them at any given time.

As well as JPeX, the bank released MailXpress, which it can be argued represents the antithesis of these awards because it is aimed at clients who trade offline. This is missing the point to a degree however, because MailXpress is about enhancing the processing of trades by netting trade details for a client across multiple funds to allow the latter to execute more efficiently over the medium of its choice.

All in all, JPM took a big step towards providing a full service online, as we noted in our innovation award segment. Given its history of innovation such as the proprietary indices LCVI, SFI and EASI (Profit & Loss, May 2002) and JPeX, we think JP Morgan’s site is one to watch.

Honourable Mentions: Deutsche Bank, HSBC


Best FX Options Platform – Goldman Sachs

We have long been proponents of the execution of FX options online and whilst the argument has generally revolved around the transacting of vanilla products, there has always been a case for more exotics to be included, at least on an RFQ basis.

In terms of the breadth of products, the flexibility of pricing tools and the ease with which clients can switch from pricing to execution, the Goldman Sachs system is quite staggering in its quality. Run through a demonstration of the system and one finds words such as “stunning” permeating one’s notes.

Clients can access execution services from the core pricing model or from the volatility surface. The pre-trade analytics are of an amazing depth and clients can drill down into these analytics as deep as they want, focusing upon part or parcel of the periods or movements. Analytics are shown in both graphical and tabular format and for those products that are not auto-priced, clients merely save the screen and send it to the trader either as an attachment to an email or in a chat window. Once the trader has established that the pricing is right, the trade can be executed.

Notably, Goldman’s clients are using the exact same pre-trade system as the bank’s own traders. Price feeds are live from the bank’s core WebET product; however, to ensure the pricing process is a manageable proposal, pricing is ‘frozen’ until a client is satisfied with the structure and then refreshes the price with a single click.

Any part of the option pricing model can be used as the baseline calculation by the clients (for example an option can be re-priced for zero-cost), and the system has been developed to enable clients to build the most extensive and complex structures. Indeed the bank boasts that the only limiting factor on this system is the memory size of the user’s computer.

The real beauty in the pricing model is that clients can alter any single leg and the entire structure is updated, and because both sides are using the same data and model, the client/bank relationship is in real time.

Put simply, this options system can handle anything that is thrown at it. Some may argue that it is too complex; however, our argument would be that the system is to be used by professional people who want the best – and this is it.

Honourable Mentions: The Royal Bank of Scotland, UBS Warburg


Best Range of Execution Tools – Citibank

In the rush to add the bells and whistles that make a client’s life much easier, it can often be overlooked that the process at the heart of our markets – trading – can also be enhanced. Typically clients are offered RFQ or click and deal execution by their banks and this satisfies the majority very well.

Citibank wins this award because not only does it provide these services, it has also developed other tools to enable clients to transact large amounts of business without leaving a footprint in the market.

The Benchmark product that Citibank operates is in effect a matching system that operates at regular intervals throughout the global day. Cl

Profit & Loss

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