ACI UK is delighted to have worked with SWIFT to develop its programme for the inaugural  FX Day at SIBOS in London on 23 September.   Market practitioners representing institutions, platforms, exchanges and regulators will join FX industry experts as speakers and panellists in 5 sessions taking place on Day One of SIBOS.  To join FX Day at Sibos register for  a single day pass. (One Day pass gives you access to the full SIBOS event).

Download pre-event article (E-Forex) here.

FX Day Sessions will cover:

FX Markets: balancing act between direct regulation, new technology and principles-based supervision

Regulators have sought to address behavioural issues through market participants’ commitment to adherence to the principles of the FX Global Code; to date garnering  more support from the sell-side than the buy-side. Regulators also address systemic risk in the FX derivatives market by seeking transparency, via regulatory reporting and by encouraging the use of clearing (with un-cleared margin requirements). New technology has empowered new entrants to FX markets, changing how FX trades are executed, and next generation technologies promise to change post-trade work flows drastically as well.  As such, a complex interplay of regulation, principles-based supervision, innovation and technology will drive the future shape of FX markets.

So, what IS the buy side’s perspective when it comes to implementing the principles of the FX Global Code, respecting regulatory requirements and embracing new technology?

Data, data, everywhere – but why so hard to measure?

FX markets depend on data. From pre-trade to execution to post trade, the entire FX transaction lifecycle relies on – and generates – huge volumes of transaction data.  Data informs trading strategies, and in particular drives increasing algo/automated trading activity.  Regulators collect enormous amounts of data to gauge the ‘health’ of currency markets, monitor exposure and risk, and guide monetary policy.  Better and more comprehensive data matters deeply to traders, hedgers, regulators and customers. Yet accurate and timely data on the size of the FX market itself is more difficult to obtain because it is fragmented across multiple platforms, providers and participants.

The first results from the BIS 2019 Triennial Survey will be hot-off-the-press when this panel discussion takes place, providing up-to-date numbers to drive the debate, which will ask what more FX market participants should do to improve the timeliness and quality of data, and what more might regulators demand if they do not.

FX liquidity – the next industry challenge?

Recent surveys state that liquidity is seen by currency traders as the biggest challenge in 2019. Technology itself has changed the sources and nature of liquidity. Technology has now revolutionised the way currencies are traded, and the types of people that trade them, and created a host of new trading platforms, trading methods and trading firms. As more and more electronic trading platforms and non-bank liquidity providers emerge, and use of algorithms increases, perhaps coincidentally currency markets have become vulnerable to sudden drops in liquidity, resulting in flash crashes and other extravagant price movements.

Whenever there is market stress liquidity is impacted, and liquidity has the greatest impact on the financial health of market participants. So, it is hard to overstate the topicality of liquidity management today, to traders, hedgers, regulators and customers.

FX innovators: the FINTechs planning to transform the FX markets

FinTechs in FX are promoting powerful new technologies to cut the costs of trading and to settle currency trades. Incumbents are investing in new technology directly, or partnering with technology vendors, or backing start up FinTech ventures. FinTechs have already reduced the costs of currency trading, notably for retail investors. They are improving the terms of trade for corporates, asset managers and end-investors too. FinTechs are targeting the back and middle offices as well, seeking to eradicate or reduce post-trade costs and crypto-currencies may yet turn the FX markets upside down.

In this session a select band of FinTech providers will explain to the audience and our panel their ideas on how to make the FX markets more open, transparent, liquid and efficient.

How FX workflows are changing to prepare for the next digital age

Seamless, end to end trading efficiency from front end execution to back office processing has been a core objective of all market participants for many years. More recent innovation in, and broad adoption of, APIs, and the widespread use of connectivity standards, has enabled direct connectivity between platforms and FX risk managers. These in turn enable FX pricing and transactions to be embedded directly within client workflows. In this way, simple processes from making payments to settling invoices to complex balance sheet management, can have embedded FX capabilities. There is a plethora of established technology providers in the eFX workflow space delivering confirmation matching, aggregation, compression, reconciliation, settlement services and so on.

This session looks at next generation workflow solutions that further integrate FX execution and treasury systems.  A panel of representatives from the corporate sector, liquidity providers and the FinTech community will debate these themes and help to shine some light on the future workflows.