After some 14 years at Deutsche Bank, Vittorio Nuti recently took over as global head of algos in FX and LD based in London. It’s been a varied career since he’s joined. Nuti spent almost five years in Sydney and has now been in London for nearly five years. Over the last decade he has moved through options and spot with voice execution and developed the e-options business before moving into the electronic space. The industry trend, he said, is towards algorithmic execution, whether it be for large trades or systematic trading firms, like CTAs. And though CTAs tend to use algo execution, in general, the market is shifting to a “partnership” with their bank. What clients are looking for from their liquidity providers is to understand the costs of foreign exchange execution: what is the opportunity cost? Should I utilise an algorithm?
“Those are the difficult questions that the industry as a whole is trying to answer, and I think those are the key trends for the coming 12 to 18 months,” he added. Deutsche is still finalising some of its development plans as it assesses the industry landscape, said Nuti, but one thing’s for sure: the bank is intent on maintaining its segregated structure between desks. “Clients want to have an algo desk that is functionally separate to the principal desk and that’s the structure that we’ve had in place for some years, and we don’t see that changing.” That’s because anonymity in execution is one of the key benefits to FX algos, and the structure keeps anyone outside of the algo team from knowing a parent order and which firm is behind it. In operation a few years now, Deutsche is targeting strong growth prospects for the FX Algo Product by making significant investments in that space, Nuti said.