Nicholas Pratt
Nicholas Pratt

Minimising costs and market impact with a new breed of FX algorithms

Nicholas Pratt explores what developments within the FX market are influencing the use of algorithms and whether proposed changes to the way the FX market operates will create new opportunities for these to add value.

The BBC recently broadcast a series of documentaries by film-maker Adam Curtis entitled Watched Over By Machines of Love and Grace. The first of these programmes, Love and Power, looked at the rise of information technology and its use in transforming the financial markets. The programme’s narrative weaved together the rise of influential individuals such as 1940’s philosopher come novelist Ayn Rand, the 1980’s computer entrepreneurs of Silicon Valley and former Federal Reserve chairman Alan Greenspan and plotted a course that went from the rise of moral objectivism of the 1950s to the deregulation of the derivatives market in the 1990s to the financial crisis of 2008. Central to the plot was man’s misguided belief that it was possible to use computer networks to create stable societies and markets that could operate free from the vagarious interference of political control.  The programme certainly evoked many interesting debating points and highlighted some provocative...continued

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