The rapid automation of processes has provided FX market participants with a variety of sophisticated tools with which to do their jobs. However, alongside the powerful new capabilities provided by these tools come workflow inefficiencies preventing users from deriving full benefits. Bart Joris explains the issues and how end-to-end workflows can be tailored for maximum advantage.
- The FX market has benefited enormously from technological innovation in recent years. Market participants now have access to a wide range of tools which provide access to liquidity and real-time information.
- The availability of smarter trading tools, while welcomed by FX professionals is also creating new challenges: Desktops have a glut of fragmented apps which are difficult to use in a unified way.
- User frustrations can be eased by the consolidation of multiple platforms and the streamlining of workflows.
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The Refinitiv Workspace Project was commissioned in July 2022 to demonstrate the relevance and application of automation in FX markets. The report focuses on the future of financial workflows and on the solutions and capabilities available to innovate them. To better understand the current technological capabilities of FX professionals, a quantitative survey was taken of 600 respondents globally. Roles and organisation types varied, but all respondents used, or were responsible for, FX data, apps and/or tools used as part of the trading workflow.
A constant juggling act
The survey found that, across the globe, FX professionals were using nearly eight different internal and third-party apps simultaneously. In the APAC region and among respondents working in investment banks the figure was as high as 10, while, overall, respondents were using three or four apps at a time to complete a single task.
The need for speed
Using these apps as standalone tools is inefficient on a number of levels.
Their inability to share information seamlessly leads to errors and delays – particularly significant in the context of the FX market where instantaneous decision-making is important. Also, in today’s hybrid working environment, market participants need the ability to link apps across multi-screen workstations and access the right workflow tools.
For traders, having access to the right tools and analytics is crucial to achieving the best execution. For quants, importing data manually from multiple apps means that there is no ‘single version of the truth’ when it comes to describing data used inside a model. This complicates the validation and compliance checks required and, again, leads to delays which could be avoided with the ability to pipe data automatically into frequently used apps.
Communicate for success
A significant amount of time can be wasted looking through numerous messages and notification windows to track down information. In a fast-moving environment like FX, it is essential that information flows rapidly and efficiently from front to back office and from organisation to client. With the migration in recent years to home and hybrid working, the need to streamline communications is more important than ever.
Questions in the Refinitiv Workspace Project survey regarding channels of communication used internally and with vendors and customers pointed to significant regional variations, with email used much more widely in the Americas (68% of respondents’ time spent using this channel) than in EMEA (20%) or APAC (27%).
Responses from the APAC region indicated a preference for VOIP (23% as against 16% in EMEA and only 10% in the Americas). Respondents overall indicated that only 11% of their time was spent on the phone, which demonstrates that the integration of messaging needs to be flexible enough to take into these cultural preferences, particularly for individuals in sales or other client-facing roles.
Interoperability is key
It’s clear from the survey that both institutions which trade FX and individuals within the industry have an appetite to improve end-to-end workflows by reducing the number of apps across their desktops. To have maximum impact, however, workflow management needs to combine seamless interoperability with streamlined implementation. To avoid app overload, firms should adopt technology that easily integrates with their existing systems and streamlines workflows.
Refinitiv Workspace for FX Trading has been developed in response to the challenges facing FX market participants in today’s increasingly competitive environment.
Workspace for FX Trading has been built on a foundation of machine learning and artificial intelligence to provide app recommendations which are directly relevant to a user’s specific role and context. Users can incorporate Refinitiv data and cloud-based analytics with their in-house data to drive trading decisions within the desktop, Excel or native Python Codebook environment.
Customised to user requirements, Workspace for FX Trading empowers FX traders to achieve more with less – letting data, workflow and technology do the heavy lifting.