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Margin FX Brokers Flock to Integral for Flexibility, Control, Time to Market and No-Money-Down Solutions To Run Their Own FX Business

This week’s news about Alpari partnering with Integral highlights a larger trend: Margin FX brokers are choosing Integral as their business solutions provider. The combination of access to liquidity, rapid time to market, no upfront costs, the flexibility to pursue the business model of their choice and the assurance to have all key elements under their control is hard to beat.

As a neutral technology provider that offers a fully managed end-to-end solution, Integral offers a unique value proposition that resonates with our customers.

It’s a technology arms race

Global foreign exchange markets have become a very competitive business and in it managing a margin FX brokerage is no exception. Therefore, having the right partner at your side is extremely important.

We invested in technology solutions complete with a network of liquidity providing banks, ready today and available for margin FX brokers to build their own private FX exchange, and to deliver branded trading services to their retail customers.

The power of cloud computing

All our services are delivered in the cloud, offering the advantages of this business model such as dramatic cost savings through a shared technology platform, on demand services that scale elastically in line with our customers’ business needs, and a pay-as-you-go business model.

Since we don’t charge any up-front costs, we only get paid a small token every time one of our customers executes a trade. This is very different from the traditional purchase-and-install software model and ensures that the interest of both Integral and its customers are aligned.

We work with margin FX brokers to assist them in assembling their own liquidity from multiple banks. If those banks are already on Integral’s FX Grid® – and many are, then established connections are in place. Connecting once to Integral is all that it takes to be ready for connecting to other participants. In the rare event that a connection doesn’t exist yet, Integral will research the particulars of that situation and even build it on behalf of our customers.

As importantly, we will ensure that these connections continue to stay up and working. We’ll track the many changes that the liquidity providing banks make on their end and ensure that service to our customers is not interrupted. It all contributes to the high availability of our trading network.

You are in control

Our various cloud services add up to an end-to-end solution that includes everything FX brokers require to run their own business. Since it is delivered a la carte and not as a fixed bundle, brokers can pick and choose. They end up with everything they need and nothing they don’t. That includes the option to take advantage of FX Inside Professional™, our execution management system (EMS) for the broker’s professional customers.

Since nobody knows their business better than they themselves, we offer our broker customers real-time analysis and administrative tools so that they are in full control of their FX business. That way, they can customize solutions that specifically fit the needs of their various customers.

A new reality

The time of one-size-fits-all solutions in FX is over. FX market participants demand a technology solution that fits their business, not the other way around. They further require the tools that put them in control of their FX business. Integral understands and supports this trend. Our rapid customer growth is testament to the fact that what we offer resonates with the market.

The Top 10 Reasons Why Competing in The Olympic Games is Like Just Another Day Trading FX

The Olympic Spirit is alive in FX Markets. There are more than just a few similarities between what is happening in London and developments in global FX markets. Consider a few key characteristics and draw your own conclusion.

Reason #10: Foul play can lead to disqualification

London 2012: A Swiss and a Greek athlete sent home for racist tweets, other athletes leaving suddenly due to ‘illness’ that is rumored to be linked to doping

FX Markets: Google CFTC and enforcement or go here: http://www.cftc.gov/LawRegulation/Enforcement/EnforcementActions/index.htm

Reason #9: Audience participation

London 2012: In many venues, many seats are empty and emergency measures are in place to fill them

FX Markets: Semi-annual survey data for FX spot shows that here also, volumes are down in double-digit numbers in key arenas

Continue reading The Top 10 Reasons Why Competing in The Olympic Games is Like Just Another Day Trading FX

WEBINAR: Cloud computing a “transformational technology”

If you missed last week’s webinar on the power of cloud computing in FX, I encourage you to listen to the recording here. The panel discussion that included Joe Conlan from FCStone; Javier Paz, an analyst with Aite Group; and me, was moderated by Saima Farooqi, the executive editor of FX Week.

In what I believe was a lively exchange between a provider of a cloud-based platform, a user of such (FCStone) and an analyst who ponders these developments from a more academic point of view, we touched on all kinds of issues from the theoretical to the practical.

I hope you’ll get a lot of ideas for how cloud computing could deliver for you.  I am looking forward to hearing about them.

‘Just-in-time’ — Just in time for FX Brokers?

How inventory got its bad rap

Traditionally, enterprises viewed inventory as a way for a company to store value, and as a safety feature to ride out market fluctuations. It was perceived to be a good thing. That view has changed dramatically with the advent of information technology that made just-in-time (JIT) delivery possible. As I will explain, reducing inventory also reduces market risk. In FX, just-in-time delivery of currency rates holds the promise for FX brokers to eliminate a major headache that has been a source of major risk taking in the past: Internalization of deal flow. I think JIT will fundamentally improve the risk structure of a broker. Given the reduced risk, brokers will begin to divert their energy to marketing and sales with the eventual goal to lower their prices to the optimal level to maximize market share and overall profits, not marginal profitability.

Why holding inventory equals holding market risk

The simple truth is that inventory is costing you money in more ways than one. Obviously, it is tying up capital because there are costs associated with you acquiring products and holding them. It might be less intuitive that you also just bought yourself market risk, i.e. you are now on the hook for your product to sell as predicted. If it doesn’t, you will have to discount it later just to get rid of it. Because companies know all this, their initial go-to-market price needs to be higher to account for said risk, in addition to covering costs and a profit margin. Continue reading ‘Just-in-time’ — Just in time for FX Brokers?

Clarity of Thought

One of the traditions at year end is to take stock. Reflecting on the past 12 months is an exercise that brings clarity of thought. Going through a crisis can have a similar effect.

As the economy finally stabilizes following the events in the fall of 2008, we are looking over a changed landscape. There has been a lot of change in the FX market place, in the number of participants, and in how the survivors do business. In the world of financial services, we have noticed a renewed focus on core competencies. Banks and brokers who owned real estate, sold their offices and leased them back. They outsourced proprietary operations and are leasing back services that do the same.

On the positive, the state of the Internet economy allows for many business services to be delivered On Demand.  While consumer-focused businesses embraced that trend and started to reap its benefits years ago, we see it finally taking hold in FX markets as well. A crisis brings clarity of thought.

Instead of investing millions of dollars in a proprietary IT infrastructure to run foreign exchange operations in-house, while simultaneously assuming operational and market risk, FX brokers and banks took stake and realized there is a smarter, low-cost way to do the same:

  • Participate in a shared FX infrastructure that spreads operational cost and system risk amongst hundreds of participants
  • Subscribe to On Demand services that scale seamlessly up and down in line with customer demands
  • Only pay for services when actually using the system, i.e. generating revenue for oneself
  • Free company resources to focus on marketing efforts to build one’s business