CFH Clearing: Discovering what it takes to become one of the most respected FX Liquidity Providers in the world

CFH Clearing was founded in 2008 and is one of the FX industry’s leading execution venues. In 2016, it was acquired in a $120m transaction by Playtech Plc, a global market-leading technology company in the gambling and financial trading industries. e-Forex talks to Matthew Maloney, Chief Executive Officer of the firm to discover more about his determined focus on having the very best liquidity offering in the industry and CFH’s future growth strategy plans.

First Published: e-Forex Magazine 82 / e-Forex Interview / September 2018

Matthew Maloney

Matthew, you were promoted to CEO of CFH Clearing in 2017 after a very successful career in the industry spanning over two decades. What do you like about your job and what keeps you enthused about it?

CFH is a dynamic, global organisation. It’s an exciting company to be part of and being CEO of CFH Clearing is a real privilege. The job is simply never the same two days running and that variety enthuses me. I have ultimate responsibility for the day-to-day management of CFH Clearing and I find it immensely rewarding to be surrounded by dedicated and skilled professionals who are constantly striving to excel. I enjoy the people management aspect of my job. Equipping our employees with the tools needed to provide an industry-leading service is really satisfying.  Observing people develop new skills, confidently deal with challenges and receive great feedback from clients and colleagues is a super feeling and one that makes me proud to lead CFH.

What do your day-to-day responsibilities within the firm usually involve?

I see my key responsibility as being focused on delivering client needs.  Sometimes this can be the resolution of short-term operational matters, getting teams to work collaboratively on finding solutions; on other occasions it can be working with our internal experts to develop our strategy over the coming months and years.  As I say, whilst no two days are the same, all days have the common theme of delivering excellence for clients and constantly striving to be better than we were the day before. 

CFH Clearing office

How would you describe the mission of the company? What are its core objectives?

CFH’s mission is quite simple.  Everyone in the company has a common purpose – we each want to provide our clients with the finest solutions in an intelligent and thoughtful way.  To do that we employ the best people and encourage them to build lasting relationships with clients.  CFH’s people have great latitude in their roles – each person is encouraged to develop, to grow, and to think creatively to solve problems – and from that we can achieve our mission.  

Please tell us a little about the range of products and services that CFH Clearing currently provides?

At our core, we provide technology and liquidity.  Our technology is proprietary, developed by a dedicated team in Copenhagen.  We believe this is critical as it gives us full control. It also means we can adapt it to cater for specific client requirements. Over the years, CFH Clearing has invested heavily in both our hardware and connectivity solutions. We believe that owning our own technology gives us a competitive edge.

We are also one of the leading Execution Venues in the industry, with an award-winning liquidity offering which is managed from London.

CFH serves over 600 institutional and professional clients in over 80 jurisdictions
CFH serves over 600 institutional and professional clients in over 80 jurisdictions

Whether clients use us for our technology, our liquidity or both of these services, we offer them a great deal of choice and flexibility when they partner with us. They can select from a range of front-end platforms, for example, and have access to multiple liquidity venues. We also offer a variety of risk management and reporting solutions. In essence, we focus on giving clients all the tools they need to grow their businesses in a competitive environment and operate more effectively.

What types of clients are you serving and how geographically dispersed are they? 

CFH serves over 600 institutional and professional clients in over 80 jurisdictions. Our clients range from leading retail FX Brokers to banks and fund managers.  A great strength of our business is the distributed nature of our client base.  This provides us with terrific insights into evolving market structures, technologies and regulatory developments.  By consolidating our global learnings and experience we continue to grow our business across the world and we share this expertise with our clients.

Who are the key individuals in your executive team and what roles do they have within the firm? 

We run CFH with a sharp focus on product, price and service.  I am responsible for the overall offering, with Marc Levin responsible for our product offering and commercial matters.  Andy Biggs takes the lead on pricing, liquidity and bank relationships, with Paul Jackson running European sales.  Alex MacKinnon runs our Asian operations, with Julia Free and Olga Larsen heading up our compliance and risk functions respectively.  Ole Rossing and Troels Madsen lead our IT development and operations teams in Copenhagen.

Christian Frahm, Founder of CFH Group and Chairman of CFH Clearing, who is based in Copenhagen, sets our overall strategy and is our lead into the wider Playtech group. The collective knowledge and experience of our executive team stands out in the industry.

Christian Frahm, Founder of CFH Group and Chairman of CFH Clearing, sets our overall strategy
Christian Frahm, Founder of CFH Group and Chairman of CFH Clearing, sets our overall strategy

Have you made any important recent hires?

Over the last 12 months we have hired in every team, around the world.  The overwhelming majority of these hires were to grow headcount to service business growth, rather than replace leavers.  CFH has very low staff turnover and we take pride in developing our people and offering them varied and interesting career opportunities within the company.  

Critical external hires for our business have been Julia Free, our Compliance Officer, and Andy Biggs, our Head of Liquidity.  Both are experts in their field and both have demonstrated great drive and tenacity.  Julia had a huge agenda from day 1, with MiFID II and then GDPR implementation, whilst Andy has implemented technology and analytics to enable us to transform our global liquidity offering.

CFH Clearing

The combination of our global reputation within the industry, the quality of our offering and the high calibre of our team has enabled us to attract talent from our main competitors - for example, Andy Biggs joined us from IS Prime, where he was Head of Liquidity. More recently, Michael Bleys joined CFH as VP Sales (EMEA) after five years in e-FX sales at Sucden Financial and, prior to that, five years at Saxo Bank. Investing in our team remains a key priority, as it is only by employing the best people that we can achieve our global growth ambitions.

Let’s talk about Prime of Primes. In what ways have you set about trying to redefine the model and what advantages do your clients get by being able to combine multiple liquidity types through one Prime Broker set up?

CFH is regulated by the FCA and offers a genuine Prime of Prime service, with multiple execution accounts and venues which are given up to a centralised Prime account at end of day.  This reduces cost and capital requirements for clients as all positions are netted down.   We see a continued drive by clients across the globe to focus their capital and trading activity with one key LP.  By offering a capital-efficient solution utilising world-beating technology and liquidity, we are able to effectively service this need.

We employ the best people and encourage them to build lasting relationships with clients
We employ the best people and encourage them to build lasting relationships with clients

The strength of a provider’s balance sheet has become an important factor in the Prime of Prime space. What benefits does CFH Clearing get by having the extremely well capitalised Playtech standing behind you?

CFH Clearing is part of Playtech’s Financials Division, TradeTech Group and this has created a real catalyst for growth. Clients clearly derive confidence from Playtech’s well capitalised balance sheet, but the benefits of our parent are manifold.  An owner with immense geographical reach and distribution, access to experts around the globe, immense technical expertise and the ability to service new product offerings, has given CFH a terrific boost.  Playtech has enabled us to diversify our liquidity offering and scale our IT development team.
CFH Clearing has been voted  “Best Liquidity Provider” for several years in a row. What do clients particular value about the liquidity services you provide and the way that you deliver them?

Being voted for as Best Liquidity Provider for four consecutive years by brokers and senior professionals in the industry is a real endorsement of our liquidity offering. We specialise in Spot FX, metals, CFD indices and commodities instruments, and provide our institutional clients with a diverse choice of liquidity at competitive prices.

We focus on giving clients all the tools they need to grow their businesses in a competitive environment
We focus on giving clients all the tools they need to grow their businesses in a competitive environment 

According to client feedback, we know they value our ability to listen and understand their bespoke liquidity needs.  We have a sharp focus on ensuring that we deliver against client requirements and are always willing to take feedback and work with clients to build what they need.  Our liquidity team works round the clock across multiple geographies to focus exclusively on sourcing and managing our liquidity offering.  Our sales and client services teams have a deep understanding of our liquidity and can quickly and professionally resolve any issues that might arise.

Where is your underlying liquidity sourced from?

Our award-winning liquidity is sourced from Tier 1 banks, key non-bank providers, and world-leading PBs.  We are very proud of each of these relationships which, when consolidated, enable CFH to really differentiate and tailor our liquidity offering to meet the specific needs of individual clients.  

Director of Sales, Paul Jackson is responsible for business growth across Europe
Director of Sales, Paul Jackson is responsible for business growth across Europe

How do you leverage your trading technology and use it to further strengthen your offering?

Distribution is key.  When we demonstrate our ClearVision technology to prospective clients, they come away seriously impressed.  So the more people that we can introduce to the technology, the more feedback we get and so the better our tech becomes.  This feedback loop is something we take very seriously.  Each of our project updates and prioritisation discussions incorporate specific feedback from clients and their development wishes.

State-of-the-art global connectivity is clearly at the heart of your offering. How have you gone about building your infrastructure network to ensure maximum stability, security and performance?

Our technology has been built and developed by a team of dedicated world-class experts.  As a group, we spend significant sums and invest huge internal resource ensuring that our technology meets not only current requirements but is built to be safe, secure and scalable for many years ahead.  Everyone involved in CFH is rightly proud of the technology that the team has built.  It is critical to our success and sets us apart from many other market participants.
 
We have invested in dedicated servers in Equinix data centres in London, New York and Tokyo to provide low latency, optimal execution, cost efficiencies and reliability to clients. 

Key members of the team: Matthew Maloney,  Ole Rossing, Andy Biggs, Marc Levin, Christian Frahm, Julia Free
Key members of the team:
Matthew Maloney,  Ole Rossing, Andy Biggs, Marc Levin, Christian Frahm, Julia Free

You are creating a very strong franchise in Asia. Why is that region becoming so important for the firm?

Our activities in Asia are led by CFH Systems and more specifically, Alex MacKinnon, who has an unparalleled name in the industry and brings with him huge amounts of experience.  He has built and mentored a great team.  We see our Asian client base working tirelessly to service their customer and that work ethic is matched by our people in Singapore, Hong Kong and Japan.  Collectively this has resulted in some terrific business wins and growth for CFH in the region.
 
The FX market is going through a period of huge transition with new regulations, technologies to exploit and digital assets to trade. Do these changes present a challenge or opportunity for you?

Undoubtedly these changes present CFH with an opportunity.  Improved regulation enhances the industry for those firms that ‘do the right thing’ and will result in more sustainable growth for firms with strong compliance cultures.  New assets and new ways to trade attract new clients and reinvigorate existing clients and we see this on a daily basis.  Unless, however, firms have the right culture, strong technology and the best people, these opportunities will be missed.  

Clients value the fact that we are part of a FTSE 250 company that owns and controls our own technology, we have interbank access to all top tier banks and over $3bn worth of credit.
Clients value the fact that we are part of a FTSE 250 company that owns and controls our own technology, we have interbank access to all top tier banks and over $3bn worth of credit. 

Whilst you have clients of all sizes, in the past, CFH Clearing’s sweet spot has been described as the start-up or adolescent broker. Is that still the case?

Our sweet spot client is one that’s mature enough to realise that a world class technology and liquidity offering from a partner that understands the business and industry developments is vital to the future success of their business.  We take pride growing alongside our clients and helping them fulfil their objectives.

How ambitious are your future business plans and what steps will you be looking to take to achieve these?

Our ambition is endless – we are fortunate to work in an ever-evolving industry with massive growth potential across multiple geographies.  We continue to recruit the finest people to grow each of our teams.  CFH is a business that wants to partner with its clients for the long-term and puts its entire energy into making this work.  2018 has been a year of considerable growth, a trend which looks set to continue in 2019.

In summary, what do you think it is that your clients most value about partnering with CFH? 

Clients value the fact that we are part of a FTSE 250 company that owns and controls our own technology, we have interbank access to all top tier banks and over $3bn worth of credit. 

In addition, I believe our focus on client service and global industry knowledge are key to our success. We are very responsive to client needs and work in close partnership with our clients in an honest and transparent manner. We have a multi-lingual team, with service available in English, Mandarin, Cantonese, Japanese, Russian, Turkish, Spanish, German, Hebrew and Danish.