Frances Faulds
Frances Faulds

Collaboration, Cost and Complexity - Work continues on modernising Post Trade FX

The FX market has always dealt with fragmentation and complexity but, as Frances Faulds asks, in order to modernise, does the industry need a wholly new model?

First Published: e-Forex Magazine 79 / Special Report / December, 2017

The foreign exchange market has gone from a position of strength, in pioneering trade automation, to lagging behind the other OTC asset classes, in terms of post-trade processing, today. While the credit, interest rate and equity derivatives markets have benefited from the greater use of standards and centralised solutions for more than a decade, the FX market is still grappling with challenges such as trade confirmation, options exercise management, and more recently, centralised clearing and regulatory reporting. While there is some evidence of centralisation, standardisation and collaboration in the FX market, it is not widespread enough yet to have made an impact and there is still much to be done at an industry level.  In 2015, IHS Markit launched the first venue-neutral trade confirmation service for FX options, with Citi and JP Morgan confirming the first trades and more than 50 asset managed firms signed up to use the service, a significant step in terms of enabling counterparties in the FX...continued

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