Germany is an economic juggernaut, with a huge stable of exporting heavyweights, some of the world’s biggest banks and a corporate tradition of technological sophistication. So it stands to reason that Germany’s buy-side would be among the more enthusiastic clientele when it comes to using algorithms for forex execution.
Anna Reitman looks at why trading firms and investors should look to deploy FX algorithms as a means to make their FX execution more efficient.
While many firms tend to pick a strategy or two and stick with that, Pecora Capital LLC prefers to mix things up. The Swiss-based macro investment management firm uses a variety of algo-based systems to navigate the world’s FX markets.
To give a trading system the highest probability of success under unknown market conditions it is important to understand the sources of bias associated with the system creation process and carry out the necessary steps to reduce these biases to their minimum possible value.
Heavy scrutiny of FX trading practices in recent years has driven an increased focus on best execution, but while algorithmic execution can sometimes outperform traditional channels, it needs to be supported by robust TCA technology. Joel Clark investigates.
Both equities and FX are continuous two-sided quote-driven markets, which creates fundamental similarities. Equity and FX algos therefore offer many of the same fundamental benefits.
Paul Aston looks at how when seeking liquidity around the WM/Reuters 4PM London Fix, currency algorithms can help. Investors can take better control of their trading, reduce costs, obtain market transparency and ensure best execution.
The traditional build-versus-buy question has become more complicated with the emergence of a variety of off-the-shelf components that make it easier and more cost-effective for either buy-side or smaller sell-side market participants to create their own FX execution solutions.
Asset management companies don’t get much bigger than Vanguard. The group, which recently turned 40, has about 280 funds around the world, with some $3 trillion in assets under management as of end-2014. That kind of size involves dealing with massive foreign exchange exposures, a task so big that Vanguard created a global team to handle FX trading.
The FX market is undergoing rapid, transformational change. A number of factors are driving this change, including regulatory developments, fiduciary responsibilities, increased focus on performance and cost and a general demand for improved transparency. This confluence of factors is resulting in an increasingly complex marketplace for participants to navigate
