TIBCO Releases Fast Data FX Technology Trends Report
Report Shows Regulation, Market Surveillance, Compliance, and Auto-Hedging Are Key Areas for the FX Market
TIBCO Software Inc. (NASDAQ: TIBX) today announced that TIBCO StreamBase's fifth annual "FX Trading and Technology Trends" report is now available. This year's Foreign Exchange (FX) study features responses from 147 institutional FX traders worldwide and finds that regulation is the FX market's primary catalyst for change, and will have the biggest impact on business over the next year.
The FX market is global in reach, subject to multiple jurisdictions, and operates 24/7. While FX participants admit that regulation is the primary driver of change, they are interestingly not overly concerned about the issue and do not identify regulatory change as a hardship. For many, the impact of regulation in changing the FX market's structure represents a business opportunity and, in the long run, a net benefit to the market as a whole.
Key takeaways from the survey include:
- Regulation is the primary driver of change in the FX market.
- Buy-side firms would most like to improve capabilities in algorithmic order execution and management, signal generation and auto-hedging, and risk.
- Sell-side firms are keen to improve pricing and rates engines, algorithmic order execution and management, signal generation and auto-hedging, and risk.
Single-bank and multi-bank platforms:
- Only 40% of respondents have systems in place to monitor FX benchmarks. Of those, 74% use internally developed systems.
- Overall, participants registered a higher satisfaction with single-bank trading platforms than with multi-bank platforms. The sell-side is significantly happier with the performance of single-bank platforms.
- However, sell-side respondents are not giving up on multi-bank platforms. Continued build-out of pricing and execution platforms for multi-bank platforms is their highest technology priority for 2014.
"The FX market is unique in capital markets as it is truly global, involving multiple jurisdictions and all types of participants, from investment banks to corporates," said Rob Perez, vice president, trading and risk management systems, GAIN Capital. "As a liquidity provider for all types of participants around the world, technology architecture is critical to our business as it enables us to process the Fast Data of the FX markets, and rapidly adapt to market and regulatory conditions."
"FX participants are some of the earliest adopters of our LiveView Datamart technology for viewing live streams of FX tradeflow data," said Richard Tibbetts, chief technology officer, event processing, TIBCO. "As an active vendor in the FX space, we see substantial investment in Fast Data projects to aggregate, normalize, and process the ever-faster and ever-growing volume of data from FX trading, because of these investment indicators we are unsurprised to learn that the FX market sees regulatory change as an opportunity."
The survey results were the subject of an online roundtable discussion by Sang Lee, co-founder and managing partner of AITE Group; James Sinclair, CEO of Marketfactory; Patrick Miles, CEO of Caplin Systems; Derek Sammann, senior managing director of FX, Metals, and Options Solutions at CME Group; and Richard Tibbetts, CTO of event processing at TIBCO. The report incorporates comments from the discussion.
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