As institutional FX markets continue to evolve, traders face a familiar challenge: how to balance execution quality against execution certainty. Passive execution can offer meaningful price improvement but often requires patience, while aggressive execution may achieve immediate fills at the cost of crossing the spread and increasing market impact.
Euronext FX’s Collapse-to-Mid (CTM) functionality was originally developed to bridge that gap. Since its introduction, CTM adoption has grown steadily as market participants have sought new ways to access liquidity, reduce information leakage, and improve execution outcomes while remaining passive.
Building on that success, Euronext FX has introduced CTM Slide, a new enhancement that gives traders greater control over how and when passive orders become executable. By allowing users to define trigger points within the prevailing spread, CTM Slide transforms midpoint matching from a fixed methodology into a configurable execution framework tailored to individual trading objectives.
The origins of CTM
Collapse-to-Mid originated from conversations with market participants who were dissatisfied with the alternatives available for midpoint execution.
Some solutions relied on complex post-trade revaluation models that could produce outcomes that were difficult to explain and predict. Other approaches exposed passive interest to sweeping activity, resulting in immediate market impact and reducing the benefits traders hoped to achieve by posting resting interest.
The objective behind CTM was to address these challenges by creating a mechanism that allowed traders to remain passive while still benefiting from midpoint opportunities when suitable contra-side interest existed. Rather than forcing participants to choose between resting passively or aggressively crossing the spread, CTM sought to combine the advantages of both approaches.
Today, CTM enables passive orders to interact at mid when opposing eligible interest is available, whether that interest originates from other passive participants or firm liquidity providers. This helps clients access improved pricing opportunities while maintaining the benefits associated with passive execution/capturing spread.
Listening to client feedback
As CTM adoption grew, Euronext FX maintained regular dialogue with users to better understand their experience and evolving requirements.
The feedback revealed an interesting trend. Some participants felt execution speeds were close to ideal. Others wanted their orders to execute more quickly, while some preferred a slower, more selective execution profile.
What became evident was that there is no single execution setting that works for every participant. Different firms place different values on fill probability, execution speed, spread capture and price improvement opportunities. A solution that is optimal for one strategy may be suboptimal for another.
This recognition became the catalyst for us to develop CTM Slide.
Introducing CTM Slide
CTM Slide extends the original CTM model by allowing participants to specify their CTM trigger point as a percentage of the spread, rather than simply relying on the midpoint.
In practical terms, this gives traders greater control over the trade-off between execution probability and execution quality.
A participant seeking higher execution certainty can configure a more aggressive trigger point, increasing the likelihood that their passive interest becomes executable. Conversely, a participant focused on maximising price improvement can position themselves more conservatively and prioritise execution quality over immediacy.
The result is a more flexible framework that can be tailored to different trading styles, market conditions and execution objectives.Clients can set their own parameters dynamically on each order via API or can request that Euronext FX applies pre-configured values per ccy pair to their orders.
Balancing price improvement and execution probability
Every execution decision involves trade-offs.
Generally speaking, the more aggressively a trader wishes to execute, the more likely they are to cross the spread and incur additional costs. Equally, the more patient a trader becomes, the greater the opportunity for price improvement, but the lower the certainty of immediate execution.
Research and client experience have consistently shown that CTM occupies an attractive middle ground between spread capture and speed of execution, providing a compelling balance between execution quality and fill rates.
CTM Slide takes this concept one step further by allowing each participant to define where they want to sit on that spectrum.
Rather than imposing a standard setting across all users, Euronext FX now enables traders to calibrate their execution behaviour according to their own objectives. This flexibility allows firms to adapt to changing market conditions, varying levels of urgency and different strategy requirements without fundamentally altering their workflow.
Who benefits most?
The flexibility offered by CTM Slide has broad appeal because execution objectives vary significantly across the institutional FX landscape.
Participants executing benign flow that is unlikely to move the market can benefit by having orders sit passively and capture spread. In those circumstances, capturing some portion of the spread or interacting at advantageous levels can deliver better outcomes than consistently crossing the market.
At the other end of the spectrum, traders managing more aggressive flow or who have a strong view on where the market is about to move can prioritise the speed of execution. CTM Slide allows those participants to adjust their settings accordingly while remaining within the same overall execution framework.
The key benefit is choice. Rather than being forced into a single execution methodology, traders can align their passive execution behaviour with their specific objectives.
Complementing existing workflow tools
CTM Slide has been designed to work seamlessly alongside existing Euronext FX functionality, including CTM and Flex Limit. Together, these tools provide market participants with a broader set of options for managing passive liquidity and tailoring execution outcomes to their requirements.
The broader trend across institutional FX is towards greater configurability and more intelligent execution workflows. CTM Slide reflects that evolution, by giving clients additional control without introducing complexity into their trading process.
Looking ahead
CTM Slide represents one step in a broader programme of execution innovation at Euronext FX.
The company continues to invest heavily in data infrastructure, analytics, and quantitative research capabilities. These investments are enabling deeper analysis of execution quality, liquidity dynamics and trading behaviour, creating opportunities to develop solutions that address genuine client challenges.
Future innovation projects we are working on include solutions to detect skew leakage, finding more efficient ways for Liquidity Providers to deliver and optimise pricing, and improving choices for clients looking to trade passively – be that at mid or capturing spread.