What are the unique requirements of your US client base when utilising execution algos?
Our US clients, like all our clients globally, are continually seeking increased transparency and control in their execution experience, and this is especially true when using execution algos. The US market has been the historical leader in transparency and best execution, concepts that evolved from the National Association of Securities Dealers’ (NASD) early work in the 60s and 70s through to Dodd-Frank’s formalisation of these terms in 2010. This, combined with the early emergence of the largest and most sophisticated equities market, means that our US clients have grown up with a trading DNA that drives the need for detailed analytics and reporting. This in turn means focusing on execution tools that minimise market impact and achieve optimal pricing. Then there are also practical nuances, such as trading late into the US afternoon as liquidity wanes or the recent transition to T+1 equities settlement – we are well equipped to help with 24/5 full functional coverage, not just a night desk on the trading side or a skeleton ops shift.
Have these needs changed over the past year?
Absolutely. While the demand for transparency and control has been constant, we have observed a significant shift towards more sophisticated data and analytics tools. Clients are no longer satisfied with simply using algos; they want to understand how they work and to prove their effectiveness. The heightened volatility of 2025 has further amplified the need for algos that can adapt dynamically to changing market conditions. This need is fuelled by a desire to minimise risk and protect against unexpected market movements, something that is newly topical in dollar markets.
How does your offering aim to support these needs?
We are committed to supporting our clients at every step of the execution process. We provide a full suite of algos tailored to different trading objectives – from our ‘opportunistic’ Stark algo to our ‘aggressive’ Iceberg algo. Crucially, our offering extends beyond just the algos themselves. Our Market Colour app provides pre-trade predictive analysis, in-flight colour and guidance, and post-trade TCA. Our recent investment in a Global FX Execution Advisory (FXEA) team adds the human element, ensuring our algo clients have an SME on hand to guide them through their execution experience.
Have you seen an increase in demand for data and analytics tools? What is driving this?
There is a clear trend towards data-driven decision making in the FX market, and in many ways it has already caught up with the equities market. The drivers are multi-faceted: regulatory requirements, the need to demonstrate best execution, and the pursuit of alpha generation all contribute. Clients want to see granular insights into trading performance. The increased reliance the buyside puts on third party data sets such as BestX and Tradefeedr is a clear indicator of this demand. Ultimately the client push for data and insights is what will drive true automation in workflows; this is something that our HausFX team focuses on with our clients who have ancillary FX activity, for example securities-linked FX.
How do you support clients through volatile market events with access to robust liquidity?
During volatile periods, access to reliable liquidity is paramount. We expend significant effort maintaining strong relationships with a diverse panel of external liquidity partners to ensure continuous access, even under stress. Our algos automatically adjust their order placement strategies to optimise for liquidity. We saw significant usage of our Market Colour app during April 2025 when Bloomberg had a pricing outage, and many clients have stayed with it as an additional tool.
In what ways has the demand for internalisation changed and how does this reflect in your offering?
The recent guidance paper on internalisation published by the FXPA shows the extent to which this topic is front of mind for all market participants. A foundation feature of our algo suite is the ability for our clients to work with our algo quants to customise their liquidity pool setup. This gives them the option to increase or decrease the level of internalised fills by currency pair and by algo type, and for our bank clients to even include their own liquidity. The prominence of internalisation stats within our TCA reporting is testament to how critically we treat this requirement in our product set.
What demand is there from US clients for greater transparency and disclosures?
Transparency is non-negotiable. US clients demand full visibility into how their orders are executed. We achieve this through a combination of real time in-flight analytics, which allows clients to visualise algo performance as it runs, commentary and analysis from our execution advisory team, and comprehensive post-trade TCA, utilising both in-house tools like Market Colour and integrations with third-party providers like Tradefeedr. We also undertake regular performance reviews with heavy users to work together on optimal execution outcomes.
Do you continue to see an appetite for customisations and bespoke algo tools and settings? How do you reflect this in your algo suite?
Absolutely. While our standard algo suite is robust, we recognise that sophisticated clients often require tailored solutions. We offer extensive customisation options, from liquidity source selection to dynamic TWAP/VWAP schedules. Our ‘A/B testing’ function further exemplifies this commitment, allowing clients to iterate their designs until the algo is perfectly aligned with their objectives. The customisations also extend beyond the development cycle; our Autobahn algo product is designed with in-flight features built from the core of our infrastructure – this gives clients ultimate control even once they’ve placed the order.
Are there any other new developments or anything in the pipeline that you would be able to share with the readers?
We are constantly innovating. One area that is particularly promising is the integration of machine learning and AI to enhance algo performance. For regional bank clients, look out for our DBHedge product. While this is more of a risk management algo, it offers the same plug-and-play access to advanced hedging capabilities as our execution algos. These projects exemplify our dedication to pushing the boundaries.
In what ways do you expect the FX algo market to continue developing over the next year?
We expect to see increased automation, a greater focus on transaction cost analysis, and although it is now something of a cliché, a wider adoption of AI and machine learning – we are already seeing this being implemented on the buy side as clients look to analyse and critique their LP panels’ performance. In addition to the existing bank players, there will be a trend towards smaller FX firms using grey and white labels to outsource their algo and advisory facilities, as a strategic tool for infrastructure and cost management. Our HausFX team is a further area where Deutsche Bank has the edge on our peers. Our FX-as-a-Service solutions are built from tried-and-tested components, or ‘building blocks’ as we call them, that are customised to each individual client business challenge and setup. Building an algo suite or risk management system from scratch in 2025 is like trying to catch a moving train – yet we have the capability to partner with our HausFX clients to deliver a robust tier 1 bank infrastructure product specific to their needs so it becomes their product.
