FX Aggregator: complex software system explained in simple words Market Pulse

You can adjust your preferences at any time through the preference link in any electronic communication that you receive from us. After the government revealed that consumer prices were running at an all-time high in January, 10-year Treasury rates finally crossed the psychologically important 2% mark on Thursday, sending equities into a spiral. Currency trade in FX is performed in currency pairs consisting of the base and quoted currencies. Spread can be defined as the difference between the best bid and ask prices in the order book. Detailed logging system that registers the entire life cycle of a client order with a time record of each stage.

The options map screen offers a convenient visual representation of upcoming expiries with their strike price versus current FX spot price. Leverage data and pricing information derived from ongoing market activity to equip yourself with the intel you need to make trading forex liquidity aggregation and execution strategy decisions at speed. Leverage a full suite of FX and money market ‘open analytics’ powered by Refinitiv curves and volatility surfaces, or use your own in-house data, to price or value FX swaps, forwards, NDFs, implied deposits and FX options.

Liquidity aggregation is also becoming more complex in order to integrate new functionality such as multi-stream handling. “Creating a comprehensive picture of the market is getting ever more complicated because of the various stream sizes, order types and venue nature. This is nothing unmanageable but it something that require greater understanding of market structure,” says Vincent. According to chief operating officer Jason Wang, the geographic development of the market has been one of the prominent trends of recent years and one that has further fragmented FX liquidity. In 2019, Refinitiv launched its FX Matching service in Vietnam, supporting the onshore interbank marketplace for the trading of VND.

Data is key to managing the changing nature of liquidity relationships in FX, he says. Now it is now becoming a data source of its own, alongside smart order routers, risk management systems and execution algos. The more data you gather and harvest, the more granular you can become at getting the right quote from your liquidity providers so that you can put the right price in front of your client. The use of data may also hold the key to how aggregation services develop in the future, allowing firms to analyse their executions and their liquidity. And aggregation may also find it can have an equally profound effect on the rapidly developing world of crypto and digital assets where liquidity is similarly fragmented and market participants are struggling to manage their liquidity.

fx liquidity aggregation

They allow traders to trade with many participants using a single API or a single trading terminal. Aimed to help exchanges and brokerages manage their exposure to risk, protecting them from unexpected market movements and volatility. We provide a range of risk management tools, including stop loss orders, margin call alerts, and position sizing calculators, to help clients manage their risks effectively.

However, what differentiates TFB is that we created 6 different modes of aggregation to help our partners find the best fit for, and provide a custom service to, their clients regardless of their needs. Reflecting the need to demonstrate compliance, Refinitiv FX Trading clients can use Deal Tracker, a fully-hosted archiving and compliance service, which includes timestamps and the ability to monitor fills. Using electronic channels enables firms to easily trade local crosses and settle in local currencies. Generate a market depth of up to 1000 layers, and deliver momentum statistics to your clients. Venues periodically upgrade APIs to add functionality or new fields, including for regulatory reasons. It takes time and resources to code and test before updated systems can be released into production.

The solution is hosted out of NY4, LD4, TY3 and SG1 data centres to ensure the low latency access to market markers for order matching and execution. Liquidity aggregators can be very useful for traders who want to get the best price possible for a specific asset. They can give you simple, cost-efficient, and reliable access to high-quality liquidity pools.

“Through listening and using our experience in the FX swaps space, we’ve been able to develop a solution that will enable swaps desks to get all or parts of their curves published in such a way that opposing interest can be efficiently found. Lit, grey and dark options give users true control over how they interact in the market and, again, with no need for cumbersome manual intervention. Bid/Ask price imbalances can result in significant long or short positions, leading to potential margin calls and stop outs.

fx liquidity aggregation

Furthermore, says Wilson, the relationship between liquidity providers and aggregators has become less adversarial. “That method of sweeping the market would leave the last man standing is less prominent. It is not just executing at the best price but also helping liquidity providers to offset their risk,” he says. FlexTrade Systems is a global leader in high performance multi-asset execution management and order management systems for equities, fixed income, foreign exchange, futures, and options.

This is particularly valuable for emerging market currencies and during times of market stress. Our data platforms cover 50 million instruments and indicators across all asset classes. It features 70+ years of data, across 175 countries giving customers the information and tools to interpret market trends, economic cycles and the impact of world events using advanced charting tools and technical analysis. Named HyperSonic, this single point of access was a revolutionary change to 360T’s spot FX business as it enables market participants who previously couldn’t interact with one another across its different platforms to match off.

  • To put NDF streaming in good stead, 360T made these products available via its existing APIs, allowing clients to choose between disclosed and anonymous as suits their needs.
  • Margin accounts can be denominated in any currency from B2Broker’s liquidity, including cryptocurrencies.
  • Designed with the future of foreign exchange trading in mind, whilst in a rapidly changing and competitive market, Workspace delivers the content and functionality you need.
  • FX aggregators play a critical role in the global FX market, facilitating price discovery, enhancing transparency, and improving execution efficiency for market participants.

One of the critical advantages of MTF is that the operators cannot choose the trades to execute; instead, they must set and follow clear rules. MTFs are very popular in Europe since they offer faster order execution speeds, lower costs, and different trading incentives. Highly liquid assets are the easiest to quickly convert into cash without losing value.

fx liquidity aggregation

MaxxTrader will enable Equiti to provide their prime of prime customers with seamless global, trade execution management, and institutional trading capabilities. “The odd thing is that a large part of the client constituency on 360T doesn’t have an easy path to more than half the spot market. There’s no natural way for a car manufacturer to gain access to non-bank market-makers or even for an asset manager to access the passive bid left by a retail broker. FX market participants are generally missing out on a large amount of liquidity and it’s for us to solve that problem for them,” says Jones. By aggregating liquidity from multiple sources, the broker is able to increase the depth of market it offers to its clients and therefore deliver better fills on the order flow when compared to when it uses a single liquidity provider. Since the competition in the FX market is constantly growing, brokers are indeed under constant pressure of keeping up their ‘A game’ and providing top quality liquidity to their clients.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice. End-to-end workflow and efficiency is optimized because aggregators automate cross-venue FX trading workflows — and analytics follow and improve executions. FX markets have become more transparent, and consequently electronic trading will increase. This fuels price discovery and allows the electronification of more players in the FX market, creating a domino effect. With emerging market FX volumes increasing to 23 percent of all currency trading globally, the need to efficiently manages these flows electronically has also increased.