This week our question is for a FX eCommerce Consultant.
Q: What do you see as the main criteria buy side clients rely on when deciding what platforms to use?
A: It really depends on what their objectives are. Some firms need to manage a number of sell-side relationships, and chose a platform that facilitates this. Some are very focused on best execution and due diligence, so they need tools that enable that. Others are strictly all about the price–relationships and documentation be damned.
Frequency of trades, trade size, degree of anonymity, transaction cost: these are some of the factors that play into those distinctions. There are platforms that meet each of these criteria, although in some cases firms end up rolling their own, because they need that last bit of control over the execution process itself. The diversity within the buy-side segment is one of FX’s strengths. The fact that no one size fits all is testament to the heterogeneity of the marketplace.