Which, When and Why taking a more informed approach to algorithmic FX trading

William Essex sets out to explore why choosing the most appropriate FX algorithm for their own specific needs can sometimes be a complex undertaking for many buyside firms who may be new to the benefits and applications of using algorithms.

What is it about FX algorithms? You wait millennia for somebody to automate the global foreign-exchange market, and then all of a sudden you get dozens of smart, intelligent, intuitive, even educative FX-algo solutions all coming along at once. Yes, it took a near-terminal global financial meltdown coupled with a large-scale exodus of talent from equity desks to get the development work really moving, but now we’re very, very well supplied with FX algorithms for pretty much every occasion.­­This is good, right? Algo trading and execution effectively breed sophistication: smart-order routing, data management, the elimination of latency – all part of the same ongoing development process and all contributing to efficiencies within markets, albeit not quite efficient markets (yet?). There’s also regulation: FX algos and their enabling technologies give us transparency and a clear TCA trail. Peter Bondesen, Sales Manager EMEA, FlexTrade UK, says: “With the TCA reports that can be...continued

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