The larger banks have as a result continued to enjoy market share disproportionate to their own natural franchises. The liquidity consumers have a natural incentive to internalise as much as they can, but the technology gap makes that challenging. It is difficult and expensive to find the right people and the lead times and costs are substantial.
MahiFX has developed a solution to this problem in the form of their institutional product, MFX Compass, allowing smaller banks and brokers to compete at the same level as large banks with minimal lead times. The offering takes care of choosing the optimal combination of source markets and then filtering the data flow. The result is a clean order book, one which maximises the quality of the core order book that is then weighted and skewed by each client’s risk. That risk is run as one portfolio to maximise internalisation and generate skew for every pair that is published. The skew in the rate has three happy consequences: differentiation, shorter holding periods on risk and higher return per unit of risk. The software generates comprehensive real-time operating metrics on things like the latency of each market data feed, volatility and yield decay by pair.
Partnership is also a key part of the MFX Compass package. Customers benefit from having continual access to highly experienced advice on the best way to use these metrics. Another unique and attractive quality of MFX Compass is the profit sharing pricing model that reduces fixed costs, something which has previously been a barrier to small banks and brokers. MFX Compass allows any institution to optimise the profitability of their flow and take control of one of the best quality businesses in financial markets.
For more information please visit: http://mfxcompass.mahifx.com