62. FX Algorithms and their integration

FX order execution algorithms are already appearing in numbers, but plotting their future trajectory isn’t straightforward. Andy Webb talks to a number of major providers to gauge their views on the market.

First Published: e-Forex Magazine 26 / Algorithmic FX Trading / January, 2007

FX order execution algorithms are already appearing in numbers, but plotting their future trajectory isn’t straightforward. e-Forex talks to a number of major providers to gauge their views on the market.After an extended period of froth, the expansion of order execution algorithms from equities into FX is already underway. A growing number of established and new providers have already announced new FX algorithms, but the market is still (by equity standards) comparatively nascent. Predictions of market growth are therefore still a rather inexact science, as are predictions over the type of algorithms likely to succeed in FX. There are also a number of unanswered questions around integration with FX desktop tools and execution suites (a problem for many algorithm providers in the equity space vis à vis order management systems) and the likely user base. While a common assumption may be that algorithms are synonymous with hedge funds, in the FX space other factors and participants may...continued

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