Paul Caplin CEO, Caplin Systems Ltd
Paul Caplin CEO, Caplin Systems Ltd

Staying ahead of the curve: deploying next generation technologies for e-FX

As the world of e-FX comes of age, the competitive front line is shifting from pricing and execution towards client connectivity and ease of use. This article examines some of the technologies available to help win this new battle, and the impact they can have on customer appeal and deal flow.

In the beginning In the early days of e-FX, the main focus for most dealers was on building or procuring effective pricing, execution and risk systems. As for the connection to the end-user, it was generally assumed that this would be taken care of by multi-dealer platforms such as FXall or Currenex. Indeed, many believed that clients would always insist on obtaining multiple quotes before trading, and that multi-dealer platforms would therefore be the natural route to market. But it turned out that a substantial segment of the market values the convenience and simplicity of a single-dealer portal – and a close relationship with the dealer – above the increasingly marginal price improvements that may be available via an aggregator. As a result, the single-dealer (bilateral) portal has become an essential weapon in the armory of almost every sell-side firm, and a major source of deal-flow. Nowadays, all else being equal, a dealer will normally prefer a client to trade via its...continued

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