Edgewater Markets bolsters liquidity for NDF algos

As the competitiveness in the electronic pricing of NDFs becomes more proficient, Edgewater Markets has noted an increasing demand for greater customisation of applied algos and workflows.

Edgewater Markets bolsters liquidity for NDF algos
Brian Andreyko

As the competitiveness in the electronic pricing of NDFs becomes more proficient, Edgewater Markets has noted an increasing demand for greater customisation of applied algos and workflows. 

According to Brian Andreyko, Chief Product Officer at Edgewater Markets, the utilisation of algos to improve execution quality and limit market impact in a fragmented marketplace such as NDFs has become extraordinarily useful. “Bringing participants with large books of natural interest, who benefit directly from increased order flow will significantly enhance the NDF algo space. To make this happen however, these local players require not only technology but also a way to overcome counterparty credit constraints,” Andreyko adds.

He says that Edgewater Markets’ approach to addressing these liquidity issues has been to turn their attention to the local onshore participants. Andreyko explains that by empowering participants with the technological tools and algorithms, they are then able to price their onshore clients more effectively as well in addition to utilising the global offshore NDF marketplace as part of their pricing and hedging strategy. “We couple the technological advances with execution services, providing credit remediation as well as utilising automated switch bank workflows,” he adds. “This broadens the distribution capabilities for our clients, providing them with access to the global markets, bolstering the entire NDF marketplace. 

Each client also has their own ‘secret sauce’ for pricing and hedging, according to Andreyko. “Our technology and execution services support our client’s unique needs, as there is no one size fits all with EM pricing,” he adds. In fact, those utilising Edgewater Markets’ flexible and robust technology found that they were better equipped to optimise trade flows and take advantage of the recent increase in FX market volatility. “Our focus now is on the continued expansion of product distribution for existing clients, as well as new client adoption,” Andreyko says. “The success our clients have had, quickly spread by word of mouth, has been providing a robust pipeline for us to fill.”