Also read our article "Opportunity Amid the Storm: Mid-Tier Banks and FX"
Access More Available Liquidity
LiquidityFX offers a real-time aggregated view of multiple sources of liquidity including banks, ECNs and interdealer brokers. It displays best prices at each size while also accessing full depth of book across all venues. You can access liquidity via the API or through smartTrade's flexible trading interface.
Improve Hit Ratio and Reduce Slippage
The LiquidityFX aggregator and smart order router can be hosted in the same data centers as the major FX ECNs and connected by the highest speed connections available. This allows orders to hit the prices before they move, resulting in fewer rejections or partial fills. Higher execution probability reduces slippage.
Implement Intelligent Execution Strategies
The LiquidityFX smart order router monitors all the aggregated prices and intelligently manages execution across multiple venues. It prioritizes venues with the freshest prices and highest likelihood of execution. It breaks large orders into smaller sizes routed across multiple venues to capture a better average price without exposing trading strategy. It also works large orders over time to improve prices and reduce market impact.
Integrate with Risk, Algorithmic and Back Office Systems
Use FIX to integrate with risk management systems, pricing engines, and high frequency black box trading algorithms. Support your voice traders via the smartTrade trading screens. Facilitate straight through processing by integrating back office and settlement systems using FIX drop-copy.
Accelerate Time to Market
LiquidityFX is available as a hosted service which can be deployed very quickly. Once contracts are in place and we know which destinations you want to aggregate, we'll have you up and running in our data center in as little 2-3 weeks. (Liquidity provider on-boarding time is determined by each venue).
Protect Relationships with Liquidity Providers
Machine-gunning a single bank platform can occur when traders are sharing an aggregated feed. If multiple traders are targeting the same price, the engine will apply reservation logic.
Minimize Market Impact
Secondary market liquidity is typically pegged to the primary exchanges. Sweeping the primary exchanges may cause the banks to replace quotes, potentially moving the market away from you. The smart order router is able to prioritize venues to minimize market impact.
Normalize the Complexity of Multiple Venues
The FX market micro-structure is fragmented and varies widely by venue. Prices may be provided as continuous incremental streams or time-sliced market snapshots. There are subtle variances in latency, time-to-live, tick sizes, order types and firm vs. indicative prices. LiquidityFX aggregates the pricing feeds and harmonizes the information, providing a real time view of the top of book and market depth while preserving the unique characteristics of the prices for use by the smart order router.
Increase Transparency and Demonstrate Best Execution
Compare execution results from liquidity providers by reviewing statistical reports of fill quality at each venue by currency pair. Identify venues that may be last looking your trades and prioritize venues for smart routing based onexecution quality.
Future Proof Your Investment
LiquidityFX provides a fast time to market, turn-key solution, but it won’t lock you into limited functionality. You will be able to add in proprietary algorithms, refine the execution logic, and add new liquidity sources such as dark pools and internal venues as your business evolves.