In an environment in which liquidity has become increasingly commoditised, how do FX trading platforms offering access to this liquidity differentiate themselves?
This was the question put to Jill Sigelbaum, head of FXall, Refinitiv, during a recent video interview with Profit & Loss.
Sigelbaum responded that providing transaction cost analysis (TCA) and pre-trade analytics tools are examples of ways that platforms can offer increased value to clients, but also highlighted a number of other services that are being developed.
“What really differentiates us, and I think how we move forward, is the pre-trade workflow, the artificial intelligence that we plan to use around analysing the post-trade data so that we can make suggestions to clients, automating the process as much as possible without actually trading for our clients,” she said.
Sigelbaum clarified that FXall has no intention of becoming an algo whereby it executes on behalf of its clients, but rather that it wants to offer as many tools as possible in order to help them make the best decision about how they execute their trades and to streamline their post-trade workflows.
She continued: “You asked what’s coming ahead, some of the things we plan to do is offer a lot more nimbleness around how an order gets sliced up and executed in the market. Today, because many of our clients are asset managers and they have hundreds of funds, we take the orders from all of their portfolio managers and we try to net them down for maximum efficiency. While doing so, we’re keeping track of the fund level allocations that will be taking place later on.
“In the future, what we plan to do once we net down that order is then allow them to take that order and slice it up and be able to execute it however they see fit. So they could take a 100 million eurodollar order, slice it up into 10 pieces, send one to one bank algo another to another bank algo another one directly executed in the market, pull it back in the middle of the algo, move it somewhere else, send it to one of our other platforms like Reuters Matching or price stream. So, we want to give our clients the maximum flexibility in staging the order, executing the order and with a streamlined post-trade process. That’s where we’re headed.”
The full interview can be viewed here: