Switching to Trading FX via a FIX API

Posted by Anya Aratovskaya on May 16, 2019 8:36:31 AM

FIX API has been a trending phrase amongst Forex professionals for the past decade. The technology has proven to be the fastest and one of the most secure ways to trade in FX.
A FIX API is an application programming interface (API) that uses FIX protocol. It connects FX Liquidity makers with takers. In our case, FX FIX API is a way to connect directly with a particular Liquidity Provider or aggregator.

Read More

Topics: Traders, Industry Trends, Forex Brokerage, Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, Forex B2B, MiFID2, Wholesale FX, FIX API, Retail Trader, Institutional Broker

Does Your Liquidity Provider Really Cover Your Liability with Negative Balance Protection under ESMA?

Posted by Shobin Mathew Simon on Mar 14, 2019 8:50:19 AM

The European Securities and Markets Authority (ESMA) has implemented a range of measures intended to protect retail clients who are trading leveraged products, such as CFD’s.
The product intervention measures mandated by ESMA, under Article 40 of the Markets in Financial Instruments Regulation (MiFID II) include:

  1. Maximum leverage limits on the opening of a position by a retail client ranging from 30:1 down to 2:1.
  2. A margin closeout rule on a “per account” basis (at 50% of minimum required margin).
  3. Negative balance protection on a “per account” basis.
  4. A restriction on the incentives offered to trade CFDs. 
  5. A standardised risk warning, including the percentage of losses on a CFD provider’s retail investor book.
  6. Prohibition on the marketing, distribution or sale of binary options.
Read More

Topics: Traders, FX Liquidity, Forex Brokerage, Start Your Own Forex Brokerage, SYOB, FX Broker Startup, Forex B2B, MiFID2, Wholesale FX, FX Liquidity Provider, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

2018: Short Cuts make Long Delays

Posted by Raphael Ribeaucourt on Feb 27, 2019 8:40:31 AM

2018 was a challenging year for retail FX brokerages with many of them being sold over the counter and others struggling to implement the new rules mandated by regulators.

What we can say is that 2018 was first and foremost a year of new regulation. Legal teams have been working hard to structure businesses differently and/or adapt to the new rules. Quiet contrary to the goals of the regulators’ goals, offshore is once more becoming the broker’s common strategy, especially to continue to offer high leverage to retail clients.

Read More

Topics: Traders, Industry Trends, Thought Leadership, Forex Brokerage, Brokerage, Forex B2B, Regulation, MiFID, MiFID2, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

FX Brokerage Owner, What's Your Exit Strategy?

Posted by Natallia Hunik on Feb 12, 2019 11:11:01 AM
Planning an exit strategy for your FX brokerage is an important consideration, and one that certainly crosses an entrepreneur's mind as their business grows and evolves. Given that we currently seem to be in somewhat of a consolidation wave across the industry, this topic has been a popular one behind closed doors, as well as in the media.

Generally, compared to the software industry where we are looking at average multiples of 21-25 times EBIDTA, M&A transactions in the retail FX broker space are showing multiples of 5-10 times EBIDTA at most for the best deals we have seen recently.
Read More

Topics: Traders, Company, Thought Leadership, Forex Brokerage, Forex B2B, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

What to Expect When Moving from Retail to Wholesale (Institutional) FX

Posted by Richard Perona on Apr 22, 2018 12:12:00 PM

I thought it would be useful to compile a short list of the main differences found when trading OTC (over-the-counter) FX with an STP (Straight Through Processing / No Dealing Desk) “Prime of Prime” and a Retail brokerage.

The differences can be categorized as follows:

- Vetting / Onboarding
- Netting vs Hedging
- Deposits
- Execution
Read More

Topics: Traders, Thought Leadership, Forex Brokerage, Brokerage, Forex B2B, STP, Wholesale FX, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

How to Get an LEI Number if You Don’t Have a LOU (Local Operating Unit) in Your Country

Posted by Natallia Hunik on Apr 10, 2018 8:20:55 AM

The global push for greater transparency in financial markets continues to gain traction with top tier regulators now requiring that all entities, engaged in trading financial markets, report their LEI (Legal Entity Identifier) number to regulatory repositories.
In the European Union, this process started as of January 3rd, 2018 as per MIFID 2. In Australia, in accordance with ASIC Corporations (Derivative Transaction Reporting Exemption) Instrument 2015/844, relief from the requirement to report the entity Identifiers ends on September 30, 2018, which means that starting from September 30, 2018, entities regulated in Australia will need to report LEI numbers for their corporate clients.

Read More

Topics: Traders, Forex Brokerage, Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, Regulation, MiFID, MiFID2, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

Who Are the Real Beneficiaries of MIFID 2?

Posted by Advanced Markets Team on Jan 22, 2018 9:18:50 AM

I’m sure there aren’t many industry peers who have managed to escape the MIFID 2 avalanche this past year and, perhaps only the frenzy surrounding crypto currencies, ICO and Bitcoin comes close to the boiling hot MIFID 2 topic in 2017.

For the better half of 2017, brokers and trading firms, falling under the reach of MIFID 2, were very busy implementing the parameters and protocol needed in order for them to comply with the new regulatory standards.

Read More

Topics: Traders, Forex Brokerage, Brokerage, Regulation, MiFID, MiFID2, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

MiFID 2: Are You a High Frequency Trader?

Posted by Richard Perona on Dec 6, 2017 6:16:01 AM

As January 3, 2018 approaches, FX industry participants are busy reading through the new financial laws of “Markets in Financial Instruments Directive” (MiFID 2) in an attempt to understand how these will affect them going forward.

Originally, MiFID was created following the 2008 financial crisis in an effort to standardize the regulatory disclosures for particular markets. MiFID 2 came along with a revised set of standards which will enforce transparency, enhance investor protection and expand reporting to regulators, effectively changing the way that Europe’s secondary markets function. The significance of these changes should not be underestimated as the regulatory expectations of higher quality data sets will most likely lead to more regulatory issues and fines.

Read More

Topics: Traders, Forex Brokerage, Brokerage, Regulation, MiFID, MiFID2, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

MiFID II Reporting - DRSPs, APAs, ARMs, CTPs

Posted by Natallia Hunik on Oct 19, 2017 8:00:00 AM

by Natallia Hunik, Global Head of Sales at Advanced Markets & Fortex, Inc. and Ron Finberg, Head of Business Development at Cappitech.

MiFID II has been the focal point of many discussions in the European financial world recently. We have previously focused our attention on several of the main aspects of this upcoming regulation, such as Best Execution Policy, Reporting Framework Updates and Tied Agents Designation.
In this article, I would like to elaborate further on some of the reporting mechanisms that are being put in place by one of the world’s most respected financial regulators, the U.K’s Financial Conduct Authority (FCA).

Read More

Topics: Traders, Forex Brokerage, Start Your Own Forex Brokerage, Regulation, MiFID, MiFID2, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

MiFID II - How Many Liquidity Providers Should a Broker Have?

Posted by Natallia Hunik on Sep 13, 2017 8:42:49 AM

Best execution policy under MiFID adopts a multi-faceted approach that addresses, amongst other things, quality of execution, trading conditions extended to clients and the counterparty selection process. It also provides directions and guidelines on how best execution can be achieved.

The execution policy, set forth in MiFID II rests on several main pillars and I will briefly describe my findings on these below.

Read More

Topics: Traders, FX Liquidity, Forex Brokerage, Start Your Own Forex Brokerage, Regulation, MiFID, MiFID2, FX Liquidity Provider, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

What is an LEI Number and Where to Get One?

Posted by Natallia Hunik on Aug 1, 2017 8:19:40 AM

Welcome to a financial world, full of mysterious acronyms. LEI, CASS, ECP, EMIR, MiFIR, MTF, OTF… This industry just loves acronyms and MiFID II just gave us a whole lot of new ones to work with.
One that I have started hearing more often is the LEI number and it relates directly to the requirements embedded in the upcoming MiFID II directive. The following article will hopefully give answers to these much-asked questions, what is an LEI? Who needs one? Why it is required? How do I get one?

Read More

Topics: Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, Regulation, MiFID, MiFID2, UK FCA Registry, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

FX Leverage Globally

Posted by Natallia Hunik on May 3, 2017 8:34:41 AM

FX is the most liquid market in the world with over 5 trillion USD in daily turnover, and 1.6 trillion USD in OTC spot transactions executed each day on average. Volatility makes it an attractive investment vehicle for many traders around the world, institutional and retail.
Retail FX has been around for longer than 2 decades now, but we have yet to see the industry reach a mature state.

Two decades might be just an infancy stage for an asset class, one would say, and would be right.
Regulatory frameworks in many countries are not greatly fine-tuned to deal with FX or are not encompassing FX at all.

Read More

Topics: Traders, Thought Leadership, Forex Brokerage, Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, Regulation, STP, Leverage, UK FCA Broker, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

How Do STP Brokerages Make Money?

Posted by Yuhan Mo on Feb 1, 2017 6:14:38 AM

There are several ways that an STP brokerage can make a profit. The broker may either charge their clients a commission ($X per $million), apply a markup to the price feed, or perhaps a combination of both.

In MT4, the commission charged to the client is typically set in deposit currency per lot ( In this article, we will be using US Dollars as deposit currency for an easy and clear explanation).
An STP brokerage can also choose to charge their clients a markup, which will be added into spread that their retail clients see. Markup is normally defined as points added per lot. Markup is usually invisible to your clients and tends to be more flexible as you have the ability to adjust the markup according to market conditions.

Read More

Topics: Traders, FX Liquidity, Forex Brokerage, Start Your Own Forex Brokerage, Brokerage, Forex B2B, STP, MT4, Wholesale FX, FX Liquidity Provider, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

Fundamental Manual or Algo Trading – Which is Best?

Posted by Richard Perona on Jan 17, 2017 8:22:33 AM

In 2016, we have seen some incredible market dislocation due to various global events (BREXIT, US Elections, OPEC, GBP Flash Crash, FOMC to name a few).
Having experienced my fair share of these moves, I find myself in a unique position to be able to speak with a diverse group of market participants, ranging from Fund Managers to Hedge Funds and individual traders, each of them trying to successfully navigate through these turbulent markets.

Recently, I have found myself in conversations with seasoned industry veterans who asked for my advice on what I thought would be the next shoe to drop?

Read More

Topics: Traders, Thought Leadership, Forex Brokerage, Algo Trading, Manual Trading, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

FX Glossary: The Ultimate Dictionary of Forex Terms You Should Know

Posted by Advanced Markets Team on Jan 16, 2017 10:49:00 AM

There are many Forex terms a FX Professional have to know to do a great job and to be successful. In order to help Brokers and Traders to get to know the basics of the FX industry, the Advanced Markets Team created this glossary. 
Discover the Advanced Markets FX dictionary here and feel free to contact us if you want us to add further terms!

A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

Read More

Topics: Traders, Thought Leadership, Forex Brokerage, Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, Forex B2B, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

Efficiently Sourcing FX Block-Trade Liquidity without Information Leakage or Market Impact

Posted by Anthony Brocco on Nov 16, 2015 9:51:33 AM

New electronic solutions for FX block trading are emerging as this last bastion of voice trading is being reshaped by increased regulatory capital requirements, tighter internal credit standards and fallout from the fixing quagmire.

This article discusses the Full Order Execution (FOX) block trading mechanism offered by Advanced Markets, which operates a low latency, direct market access (DMA) liquidity pool in which liquidity is streamed by 10 leading FX banks.

Read More

Topics: Industry Trends, Thought Leadership, Block Trading, Wholesale FX, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

10 Things You May Be Missing When Selecting Your Liquidity Partner

Posted by Natallia Hunik on Oct 14, 2015 12:14:00 PM

I, along with my institutional FX Team at Advanced Markets and Fortex, am dealing with FX brokers who may be in search of liquidity, technology solutions of all kinds, infrastructure enhancements or sometimes just a price feed that is stable and reliable on a daily basis. We have seen it all from novice brokers that need everything explained from A to Z, medium-sized price-conscious brokers that are trying to bypass pre-qualifications and over-state their volume figures to get better deals to larger brokers asking us to fill out  lengthy RFPs (Request for Proposal)  while the work on selecting a new liquidity partner

Read More

Topics: FX Liquidity, Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, FX Liquidity Provider, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker

How to Safeguard Your Forex Funds Against Brokerage Bankruptcy

Posted by Richard Perona on May 5, 2015 9:52:00 AM

On January 15, 2015, the SNB (Swiss National Bank) caused a massive upheaval in the FX industry when they manipulated the exchange rate of the franc and unpegged their currency against the euro.
This action threw the markets into complete panic, ultimately producing capitulation with the CHF pairs and creating catastrophic losses throughout the industry. Market participants were affected across the entire spectrum, all the way from the top tiered global banks down to individual investors.
The large banks and market makers were able to absorb the losses (or major gains if B Book), but the smaller, more vulnerable, participants could not.
Some brokerages were forced to close their doors due to negative balances as a result of the losses sustained from their client’s positions. A multitude of firms such as Alpari UK, Boston Prime, Excel Markets and Liquid Markets became insolvent, just to name a few.

Read More

Topics: Traders, Thought Leadership, Forex Brokerage, Start Your Own Forex Brokerage, Brokerage, SYOB, FX Broker Startup, Forex B2B, Retail Trader, Retail Broker, Institutional Trader, Institutional Broker