The integration, which extends FlexTrade’s existing partnership with Tradefeedr, means buy-side users will now be able to access FX pre-trade forecast data within the FlexTRADER EMS in order to assess algo performance, compare providers and assist with automation.
The new API solution aims to improve best execution by helping users to assess the performance of their execution algos compared to the rest of the industry. It’s an important role, especially across the fragmented data landscape of the FX market, where few market participants see more than 5-10% of the market. With internalisation estimated at around 80% (according to Tradefeedr’s chief data officer Tim Cartledge in 2022), it can be hard to see in the dark. But Tradefeedr and FlexTrade are hoping to change that.
Just six years old, Tradefeedr was founded by hedge fund alumni Alexei Jiltsov and Balraj Bassi back in 2017 as an open-source data analytics service and has quickly established itself as a go-to TCA provider, launching its FX algo forecasting suite earlier this year and making a slew of new appointments including Georgia Frett as head of client engagement and Alexis Fauth as head of data science.
“We are now moving into the next stage in the evolution of accessible and actionable FX data, where buy-side trading desks can make data-driven decisions based on global data sets,” explained Balraj Bassi, Tradefeedr CEO Bassi. “For years, acquiring, aggregating, and using big data has been a challenge – this is no longer the case. Tradefeedr’s new data API changes this, delivering FX traders the information they need to optimize trading execution and outcomes.”
The integration offers FlexTRADER EMS users pre-trade insights in areas such as when to RFQ, understanding algo performance and which to select, and how to manage RFQ panels, in order to demonstrate a good execution process. For example, a trader can ask what the risk transfer price is on a trade and who is the recommended broker to execute with based on order characteristics.
Trading teams will also be able to leverage the data and analytics to create automation that triggers workflow via FlexTrade’s AlgoWheel – meaning that low-touch orders can be handled more efficiently. For example, if the risk transfer price is less than Tradefeedr’s pre-trade cost, it can be routed automatically and be executed against RFQ or streams.
FlexTrade, which BEST EXECUTION understands is working on plans to integrate similar APIs with other leading TCA providers, made the move in response to increased demand for advanced FX analytics data from its multi-asset client base.
“[They want] actionable pre-trade data tightly integrated within their order blotter,” explained EMEA managing director Andy Mahoney. “Having the data available in this way can help optimize trading decision-making and enable traders to efficiently handle low-touch orders by applying automation.”
©Markets Media Europe 2023
