THOUGHT LEADERSHIP
THE OFFICIAL NEWSPAPER OF TRADETECH FX 2023
CONNECTING THE DOTS FOR A FUTURE-PROOFED FX TRADING PLATFORM
The global FX ecosystem is renowned for its increasing complexity due to the rapid proliferation of counterparties , service providers , execution platforms , and products . IPC ’ s customers continually seek a more integrated trading infrastructure that connects all participants in the transaction lifecycle – buy-side firms , sell-side platforms , exchanges and liquidity providers , clearing / settlement systems , market data providers et al .
Yet , these same participants may not have the resources or inclination to invest directly in ‘ connecting the dots ’ themselves . Many of these firms are interested in managed service solutions to provide the services they want to deliver , without the cost and burden of building and managing the operational infrastructure themselves .
Today , Platform as a Service , Network as a Service , Cloud as a Service and Trading as a Service models are used alone ( and in combination ) to deliver sophisticated and effective managed FX solutions .
There is particular interest in ‘ Cloud as a Service ’ FX solutions ; industry research ( including our own ) indicates that a significant proportion of market participants expect FX trading flows to be either entirely in the cloud , or in some form of hybrid
For the FX industry , managed services may be the catalyst for businesses to completely rethink the way that they access and manage high-cost , high-maintenance operational resources , data storage and distribution and client connectivity and engagement , writes Ganesh Iyer , chief marketing officer at IPC Systems .
cloud / on premise solution , by 2025 . It ’ s not just a question of scale benefits – other drivers of cloud adoption include reduced investment in technology and infrastructure , ease of integration , ability to customise , and accessibility for distributed workforces .
Technology innovation enables almost any aspect of FX workflow to be delivered as a managed service , from price discovery through to post-trade reporting . Provider-agnostic service delivery and platform independence also allows firms to move application delivery environments around , depending on changing performance , compliance , and geo-political factors . This is , of course , much harder and costlier with in-house or single vendor FX trading ecosystems – they are simply not agile enough .
The ability of trading firms to be able to trade anytime , anywhere , from any device – and in a secure and compliant manner – has enormous competitive advantages . From a compliance perspective , remote access to secure trading networks must be subject to the same levels of security and rigour with respect to surveillance , data capture , and recording as a physical trading environment . This is possible through “ Desktop as a Service ” solutions in the form of high-performance virtual desktops with integrated trading apps , accessible from any data centre or public cloud .
By leveraging managed ‘ as a service ’ models , firms can deploy and execute sophisticated cross-asset class trading strategies at pace , with rapid market connectivity , enabling them to realise speed-to-market benefits and to optimise returns . As well as more efficient market
connectivity and access , firms can also benefit from fast and efficient onboarding of new providers , asset classes , and customers .
In the 4.0 technological age , and with an increasingly tech-savvy demographic occupying traditional trading roles , product and service differentiation must tick new – and many – boxes beyond efficient market access . Managed service solutions enable market participants to easily shop around , enabling freedom of choice and unfettered access to best-of-breed components in the trading stack .
For the FX industry , managed services may be the catalyst for businesses to completely rethink the way that they access and manage high-cost , high-maintenance operational resources , data storage and distribution and client connectivity and engagement . They may also be a ‘ gateway technology ’ for big data management AI / ML and accelerated digital transformation .
To deliver real value , however , managed service providers must not only connect all parties in the FX trading ecosystem , but they must also deliver trading and data processing efficiencies which assure performance and compliance at every point in the end-to-end transaction lifecycle , consolidating data from and between multiple sources and delivering it with seamless technological , workflow integration , and interoperability .
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