THETRADETECHFX DAILY from the floor single , clear-cut answer to this question . Previously , there was a trend where many technological solutions were purchased by organisations due to a lack of skills and manpower to build them internally . Nowadays , more organisations employ talented and well-qualified individuals who can develop these solutions inhouse . This doesn ’ t mean that everyone in the sector is building their own applications and tools for all FX instruments . However , there is a noticeable trend of organisations starting to create their own direct market access and / or TCA tools , which shows promise for potentially serving all FX instruments and also the non-FX instruments . The market still needs to take some steps to make this possible . For example , in the FX Swap market , we are seeing initial moves where parties are providing streaming prices , which could enable the buy-side to develop in-house algorithms for FX Swaps . For now , technology can be leveraged mainly in the pre- and post-trade procedures to execute the same processes for all FX instruments . Post-trade data for all FX instruments is already widely available , if not already stored by your organisation . This data can be used to create in-house TCA tools or back testing engines for all FX instruments , helping to improve execution . In short , the possibilities are endless , and it is up to your organisation to determine how to best utilise them .
“ Having the ability to manage , optimise , and implement your own algorithms allows organisations to retain all associated knowledge internally .”
What are the main barriers when it comes to reaching this goal ? First of all , the technology must be made available to your employees and easily accessible for them to work with . This involves addressing several risk management , security and architectural challenges . Therefore , having a reliable IT partner with a high service level is crucial . Once your IT landscape is in good order and set up according to the highest market standards , you need talented and well-equipped personnel . Fortunately , there has been an increase in tech talent interested in the financial sector , so this should not be too big of an issue . A bigger challenge might be obtaining internal approvals and managing your in-house developed procedures , applications , and tools for all FX instruments . While creating and testing these technological improvements can be done quickly and easily , getting the business to actually start using them can be more difficult . This means you need to establish a robust and widely supported risk management and governance framework in collaboration with your internal risk management department .
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