1. 360T’s new partnership generates some buzz
There was considerable buzz at this year’s TradeTech FX USA conference following the announcement on the opening day of a new partnership between 360T and Quantitative Brokers (QB), which had already garnered media attention. QB, an independent specialist algo provider, has been highly successful in the Futures, US Cash Treasury, and Options markets and has now launched a suite of FX-optimised Algos. Under this partnership, these Algos are now available via 360T. Interest in the announcement was heightened by the strong presence of both companies at the conference.
David Kalita, CEO of QB, and Matt O’Hara, CEO of 360T Americas, participated in panel discussions. O’Hara also delivered a keynote speech during the buy-side-only “Innovation Day” and hosted a lunchtime masterclass on the evolution of the 360T Execution Management Systems (EMS). And, naturally, representatives from both companies discussed the partnership
with friends and partners across both the buy-side and sell-side in a more informal environment at the networking event hosted by 360T, UBS, Wells Fargo, Deutsche Bank, HSBC and BNP Paribas after the first day of the main conference.
In his keynote address, O’Hara noted that 78% of the buy-side audience members polled at TTFX USA the year before had expressed an interest in having access to third-party Algos to complement their current bank-provided options, and this interest was evident in the comments and questions from the attendees this year about the partnership. Put simply, attendees showed an appetite to maximise and diversify their execution tools and strategies, with a goal to optimise trading, minimise market impact and reduce overall costs.
2. A changing liquidity paradigm
Every TradeTech FX event inevitably features a panel focused on the state of liquidity in the marketplace, and this panel is always well attended. This year was no exception, and it was perhaps one of the livelier discussions at the event. Although the speakers on this panel expressed concern about the declining influence of the “primary” FX venues, they agreed that the FX Global Code of Conduct has helped to improve market conditions by reducing liquidity recycling and increasing
transparency around hold times. During the conversation it was also claimed that adoption of the Code has primarily been driven by the sell-side and technology providers, but now the responsibility for sustaining these market improvements is shifting towards the buy-side. A key takeaway from the discussion was the state of risk capital in FX. Panelists observed a decline in available risk capital, largely due to regulatory changes that have made FX a more capital-intensive asset class, as well as the departure of some banks from the market over the long term.
It was pointed out that liquidity has not seemed to significantly suffer in daily trading because the speed at which capital moves through the system has compensated for the lower volume of available capital risk. One speaker claimed that this creates an impression of liquidity that is sometimes deceptive, pointing out that when the speed of capital movement slows, especially in one-directional markets, the market’s fragility becomes clearer.
3. DBG turnout reflects the evolution of the industry
Deutsche Boerse Group (DBG) was very well represented at this year’s event with 360T, Eurex, QB and Deutsche Boerse Market Data + Services, all having a strong presence at the conference.
Consider that 360T partners with Eurex to provide access to Listed and Cleared FX products, with QB to provide specialist, independent FX Algos and DBG MD+S as an additional distribution channel for our award-winning suite of Market Data products.
Consider also that 360T has partnerships in place with two other DBG firms, CryptoFinance for cryptocurrencies and SimCorp as an OrderManagement System (OMS).
Then there is the lesser-known fact that 360T and many of its major competitors work together, a fact that was addressed in the panel O’Hara participated in. Although the speakers were all technology providers and, to varying degrees, competitors, they all acknowledged that there are specific areas where they all cooperate to better service their clients. With growing expectations of what FX technology providers should offer, no single provider can realistically meet all these demands while still offering the highest levels of performance. Furthermore, economic pressures on both buy-side and sell-side firms are driving a preference for accessing multiple trading tools and services through a single connection. All this means that technology partnerships are likely to only proliferate and increase in prominence.
4. Corporate Treasurers get in on the action
This year, there was a noticeable increase in the conference agenda dedicated to the FX concerns of Corporate Treasurers, alongside a corresponding rise in attendance from this segment. Obviously, the focus for Treasurers when it comes to FX is very different compared to the Hedge Funds and Asset Managers who comprised most of the buy-side attendees at TTFX USA. Treasurers approach FX differently because FX is typically only a small part of their role, with execution being just one component of broader FX management strategies centered around topics like exposure forecasting and hedging. Additionally, they assess bank pricing in the broader context of their overall banking relationships
However, some of the more technologically savvy Treasurers are beginning to explore how tools and functionalities developed for other client segments can enhance their FX trading. This trend was evident during 360T’s lunchtime masterclass, which outlined the key capabilities of 1st, 2nd, and 3rd generation EMS platforms and discussed future innovation. Among the attendees were Treasurers from major international corporations, some of whom were among the 30+ institutional buy-side firms that participated. One Treasurer shared that they had recently executed the first Mixed Givens trade via the 360T EMS, a new workflow tool which enables users to net trades within a single currency pair that have different notional currencies while also receiving streaming pricing in competition. Both Corporate Treasurers and Asset Managers at the masterclass agreed that this functionality could drive cost savings, streamline operations, and support best execution – a clear example of overlapping needs between all three client segments.
5. FX is…cool?
During the opening address of TTFX USA, the conference chair referenced a Bloomberg article which had been published that very morning. It claimed in its headline that FX was, once again, “cool”. The article suggested that, aside from brief periods of sharp but short-lived volatility, FX markets had been relatively placid for some time. However, shifting geopolitical and macroeconomic factors are now driving increased market activity. The implications for the broader world remain uncertain, but for the FX market, the result appears to be greater volatility, which tends to sharpen the focus of industry participants.
For Liquidity Providers who can effectively navigate this volatility, as well as for alpha-seeking Hedge Funds and Asset Managers, this presents new opportunities. However, for market participants focused on hedging and risk mitigation, it necessitates a reassessment of risk management and trade execution strategies.
For technology providers like 360T, this shift underscores the need for a highly consultative approach, working closely with all segments of the FX industry to understand evolving needs and align technological innovation accordingly.
Is any of this, actually, cool? Maybe not—but the heightened excitement, engagement, and urgency at this year’s TTFX USA conference suggest that FX is certainly more dynamic than it has been in recent years.
