Launched by the global investment banking community in June 2011 and supported by Etrading Software Limited (âEtrading Softwareâ) and Expand Research LLP (âExpandâ), FICWG aims to promote the global use of FIX and other industry standards across all fixed income products. Since launch, FICWG has established significant momentum in defining the next generation industry standard for the trading of Interest Rate Swaps (IRS) and Credit Default Swaps (CDS), working in collaboration with the FIX protocol Ltd (FPL) and all major stakeholders in the industry.
The benefits for the market of the new industry standard include:
1. Lower cost of ownership of technology
2. Faster and easier connectivity integration between market participants
3. Faster time to market for new features and products
4. Greater vendor choice and technical flexibility
5. Ability to leverage and re-use IT infrastructure across multiple asset classes
6. Improved supportability of trading platforms across asset classes
â The leadership demonstrated by FICWG members has already resulted in a paradigm shift in the swaps markets towards acceptance of open industry standards in the pre-trade space.â , says Sassan Danesh, Managing Partner at Etrading Software. âWe expect tangible benefits to flow to market participants, as individual organisations align their IT strategies and investments to this new era of greater technical openness and resulting increased innovation.â
âThe commitment of FICWG members to open connectivity standards for the electronic trading of swaps is perfectly timed for the industry,â says Rupert Bull, Managing Director at Expand Research LLP. âThe expected migration of trading to Swap Execution Facilities (SEFs) increases the need for a harmonised approach to connectivity that the FICWG initiative aims to meet. The resulting increase in pre-trade efficiency brings real benefits to financial institutions, trading venues, as well as to independent software vendors.â
Over the next few months FICWG will continue to work with FPL and the industry to finalise the emerging protocol for trading IRS and CDS and to encourage its adoption by market participants.
About the FICWG members:
The members are a group of global broker-dealers who are committed to the promotion of open standards for the trading of fixed income products. They collectively represent a large proportion of the global fixed income OTC market and consist of BofA Merrill Lynch, Barclays Capital, Commerzbank Corporates & Markets, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JP Morgan Chase, Morgan Stanley, Royal Bank of Canada, Royal Bank of Scotland, SociÃ©tÃ© GÃ©nÃ©rale and UBS.