FX algos high on the agenda at TradeTech FX

TradeTech FX returned to a full in-person programme this September in Amsterdam, with a notable increase in the number of discussions covering FX algo and TCA related topics.

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Starting off the event, the Innovation Day highlighted the strength of interest from the buyside for algo use. The panel ‘Capitalizing on New Trends, Technology and Liquidity Pools’ featured a team from MN Investment Management (MN) who shared details about their recent projects, including the suite of execution algorithms and TCA tooling currency execution. Liakos Papapoulos, Senior Investment Manager, Treasury at MN also featured in the ‘Buy Side Wishlist Interview – TCA, data, algos and liquidity’ which explored the needs and requirements of the buy side FX Execution desk, including the use of execution algos for improved liquidity access. He also touched upon MN’s recent cooperation with pension peer PGGM regarding FX Big Data research as part of their joint Academic Excellence Program that was launched last year in a bid to attract talent and further reduce costs.

Certain themes, such as the electronification of FX, have become more predominant at the conference, says Saeed Amen, founder of Cuemacro, and the event explored how these trends have already had a big impact on FX trading desks. “Whereas before electronification was purely around FX spot, now it’s moving to areas like FX NDFs and also FX options,” he adds. “The topics of discussion at TradeTech FX have evolved rapidly over the years. What is clear is that automation will continue, and the skillsets required for this are also changing.”

Erwin Hazeveld, Senior Investment Manager Treasury, Rick Lodder, Algorithmic Execution Specialist, Bart Helder, Data Scientist and Engineer and Wouter Stijl, Investment Manager Treasury.

Electronification was also a main topic of discussion during the market structure panel, Amen adds, where it was also noted that changing skillsets are needed to navigate these markets, in addition to traders’ views. “Execution style also came up. Buy side clients are using more passive algos, essentially willing to take their time to match orders, noted Carolina Trujillo at SEB,” says Amen.

In his view, the panel on liquidity providers proved particularly illuminating. This included a discussion about how TCA has moved on from beyond the basic metrics, noting innovations such as Tradefeedr’s peer universe on algos. “Often in isolation a single client may not execute a sufficient number of trades using different algos to make a comparison between their performance. However, when this data is pooled amongst many clients, it becomes easier to make statistically significant observations,” Amen reports.

Contributor: Saeed Amen is the founder of Cuemacro, co-founder of Turnleaf Analytics and Thalesians.

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