After its recent acquisition of TickTrade Systems, leading electronic trading platform provider smartTrade Technologies released a combined LiquidityFX next-generation (LFX-NG) platform. We asked David Vincent, CEO of smartTrade to tell us more about the development of the platform and the key features and benefits that it delivers.
- David, why did you decide to develop this new platform and in what ways does it combine the best of both firms’ technology solutions?
First, let’s look at the wider context of the FX market. On the face of it, FX is a simple asset class. It’s also the most traded by average daily volumes. As a result, banks and their clients are operating in an extremely competitive space. The trend in recent years has been for squeezed profits and increased automation, and there’s no reason to think that will change. So how can banks operate best in the face of these challenges? The answer is for them to add more value for their clients, whether by deploying specific FX products to address their needs, analyzing trading behavior, or simply making it very easy for clients to transact business at great rates.
Back to the question. Both smartTrade and TickTrade had a rich portfolio of functionality to support front-office teams in this space. On close inspection, each company had a slightly different, yet complementary, focus. The combined offering took the best features of each. Our platform is now a clear leader, not only in terms of delivering value to banks but also in addressing how they can add even more value to their clients. We address market trends in various ways.
Using advanced AI and machine-learning techniques we can now help banks and their clients to understand their own trading patterns in unprecedented detail. By analyzing market behavior, both banks and their clients can make more efficient and less impactful FX transactions, ultimately saving money.
We see bank payments departments looking to empower their clients with tools to allow them to input, net, split and administer their own transactions. This frees banks to pay bills and fund purchases more efficiently, reducing operational risk.
The crypto market may have cooled for the moment but the majority of our clients feel that the sector still has great long-term potential. The combined smartTrade offering provides rich support for cryptocurrencies with ongoing DLT research.
Whether using signals derived from analytics or direct inputs from trading, clients are increasingly looking for real time optimization of their platform’s performance and the underlying client trading experience. Banks can now react in real time to changing market conditions or client behavior.
To summarize, the LFX-NG product evolution combines the richness of the LiquidityFX platform with a new value proposition for analytics, payments, crypto and automation. This enables banks to derive significantly more value from the FX market than previously
2. What range of modules does LFX-NG offer?
Modules included in LFX-NG include Taking, Making, Aggregation & SOR, Distribution, OMS. Payments, Advanced client, sales & retail GUIs, AlgoBox, and Advanced Analytics. The platform is cross-asset by design.
3. What instruments are being covered by the platform and how much flexibility does it provide in the way it can be deployed?
On the FX side we support standard spot, forwards, swaps, NDFs and NDS as well as options, money markets, precious metals, futures and cryptocurrencies. We’ve added support for physical metal products for a number of precious metals refiner clients. We also support the full range of post-trade functionality.
The platform is truly modular, allowing us to deploy specific functionality to meet clients’ most pressing needs, adding additional components as needed.
4. smartTrade has built much of its reputation for excellence on the back of your scalable ultra-low latency cloud platform. How important and central to LFX-NG is the use of this proven cloud solution?
The decision to develop our own meta cloud technology has been a major factor in our success. Our meta cloud allows to deploy and manage seamlessly our infrastructure using our own private cloud or existing Public clouds. We entirely manage the meta cloud balancing security and reliability concerns with cost-effectiveness. The proven stability and resilience of smartTrade technology under the difficult market conditions of recent years means that our clients feel confident automating processes and using the platform to its full potential.
5. Please give us some examples of the benefits the LFX-NG platform will deliver for clients of the institutions using it.
Tight, deep and reliable pricing is obviously key for banks wanting to provide value for their clients, but they also want to understand the global picture. smartTrade’s combined offering allows us to bring together the collective experience and wisdom of all smartTrade and TickTrade clients around the world.
I mentioned analytics earlier, but to reiterate: with the LFX-NG platform, the processes used in other sectors to profile and analyze segments can now be applied to a bank’s end clients. The sales team can use machine learning to segment clients, see who outperforms or underperforms, and what can be learned.
6. What can we expect to see next in terms of new products and services from smartTrade’s e-FX team over the coming months?
I’m glad you asked that! It’s a really exciting time for our clients. We’re adding the final enhancements to our analytics offering which will enable clients to anticipate previously hard-to-predict actions and flows. For example, if a client usually trades around the end of the quarter to make a payment but fails to complete this transaction as usual, wouldn’t it be great to receive an alert? If a client usually trades X amount a month but the usual volumes don’t materialize, shouldn’t sales be alerted? This is just a taste of what the future will hold with smartTrade’s AI-based Predictive Analytics.
We’re also adding the ability to use signals from the analytics in smartTrade’s AlgoBox. This gives the ability to write code that enables the system to self-calibrate static data based on real-time trading behavior. So only your imagination limits the value you can add!