Frances Maguire
Frances Maguire

FX Prime Brokerage – a 15 year business set to benefit the wider financial marketplace

The new regulatory environment looks set to shape the future of FX prime brokerage as well as open up the services to a wider audience. Frances Maguire talks to providers about how the FXPB model is evolving and how they are preparing for new growth.

First Published: e-Forex Magazine 49 / Features / October, 2012

Over the last 15 years the mechanics of the FX prime brokerage model have changed and evolved and will continue to change still more with the incoming regulatory requirements around FX instruments, and the start of mandatory clearing for FX options and NDFs. No longer reserved for hedge funds and alternative trading strategies, the regulatory changes will mean that FX prime brokerage will become a more essential part of the FX trading infrastructure. Newedge has a full service FX prime brokerage offering within its multi-asset Prime Clearing Services division.  Andy Waterworth, Head of Fixed Income & FX Strategies, at Newedge Prime Clearing Services, says that the FX market had already done much itself to mitigate risks but the new era for FX will be focused on technology and reporting, and the provision of greater pre- and post-trade straight through processing (STP). He adds: “The introduction of a centralised clearing mechanism adds an extra operational and cost layer so participants are...continued

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