Over on Tabb Forum, Tanuja Ranery, CEO of MarketPrizm discusses FX platform innovation, and Single Dealer Platforms.
Her comments certainly align with Caplin’s view that banks with their deep understanding of client workflow and risk management needs are continuing to innovate to deliver highly relevant targeted SDP solutions to clients covering the full trade life-cycle of pre-trade, trade and post trade services.
Tanuja comments that:
… Among the most prominent innovations in recent months has been a rise in single-dealer platforms (SDPs), which provide greater speed and reliability of trade execution. SDP clients are benefiting from improved analytics, research, superior post-trade processing capabilities, and straight-through processing (STP) solutions offered by the banks.(Caplin posts on SDP innovation here , here and many more)
For example, according to Bank of England data cited by research and consulting firm Celent, SDPs have overturned rapidly, growing MDP volumes from several years ago to post 54% of all FX transaction volumes in the UK in 2012. (Caplin post on SDP volumes outpacing MDPs here)
In addition to growth of SDPs, there is also a growing demand for FX platforms that provide a combined electronic and voice trade blotter showing all trades, regardless of execution channel. This enables clients to perform aggregation, roll forward and allocation of trades, giving customers greater accessibility and control of their trades. While electronic trading of FX now exceeds voice trading, clients still want voice trading capabilities as part of their overall package — e.g., for emerging markets where platforms might not be able to handle very large tickets in a particular currency. (Caplin post on SDPs combining electronic and voice trades into single blotter here)
Full Tabb article here